MoneyOnMobile, Inc. (OTCQX: MOMT) is a global mobile payments technology and processing company offering mobile payment services and is India’s largest cell phone payments network. MOMT’s proprietary system allows consumers to pay bills and send money to other consumers throughout India using only their cell phone (smart- or feature-phone). The Company addresses this greenfield opportunity in a country of 1.2 billion people, at least 50% of whom are unbanked and have no access to the convenience of electronic payments common in the West.
MOMT currently generates 8-10 million transactions monthly, has 188 million cumulative users and has established its footprint in more than 319,000 retail locations across India.
MOMT is extremely undervalued when compared with similar companies such as M-PESA in Kenya, with 30 million users and $1.1 billion in monthly transaction volume, and QIWI (NASDAQ: QIWI) in Russia, with 70 million users and $1 billion in monthly transaction volume. Comparatively, MOMT is targeting 600+ million users in India, the world’s fastest growing economy. QIWI’s market cap is more than $911 million, and when compared to $35.8 million for MOMT, it’s easy to see the potential upside for MOMT.
Recent M&A activity in the industry shows additional promise. In February 2017, PayPal agreed to buy Bill Payment Management Group for $233 million in cash, and Mumbai-based Tech Process Payment Services LTD was sold to Ingenio Group for $88 million in January 2017. The increase in deal activity in the space bodes well for the long-term potential of the payment services market.
- Indian Government’s decision to demonetize large denomination currency notes provides MOMT a significant opportunity to increase its revenue and profit
- Processing volume up 119% to $10.2M (674 million rupees) since demonetization announced
- MOMT’s 3Q17 Gross Margin was 59%, up 4% over 3Q16
- 188 million Indian consumers have used MOMT services, which are distributed through 326,401 retail stores
- Company launches new MOMT ATM cash out services
- Customers cash out money with merchants / retail stores
- Significant unmet need for cash out services
- Services also include Point of Sale (POS) capabilities
- MOMT services allow unbanked consumers to make payments through an easy-to-use cell phone app; disrupting the status quo and filling a significant unmet need
- Consumers can pay their utility payments, recharge cell phones, and pay cable bills
- Enables access to ecommerce
- $30 billion prepaid telephone market, $10 billion prepaid TV market (MOMT has <0.5% of each)
- 91% of transactions completed in cash
- 900+ million mobile phones; 1.1+ billion SIM cards