Mobikwik, a digital payments platform, has received approval from the capital markets regulator Securities and Exchange Board of India (Sebi) for its Rs 1,900 crore ($255 million) initial public offering (IPO), according to sources familiar with the matter. Mobikwik is expected to go public before Diwali (November 4) with a valuation of $1 billion, according to sources.

The company is claimed to have received interest for anchor investment in its IPO from sovereign wealth funds and financial investors. A day before the IPO, anchor investors are given shares at a set price. This is a measure of the IPO's demand and popularity.

The Gurugram-based startup is one among a rising number of consumer internet companies aiming for stock market debuts this year, including Paytm, Nykaa, and PolicyBazaar. When food-delivery network Zomato had a successful debut in the Indian public markets in July, it kicked off an IPO frenzy among Indian consumer firms.

According to Mobikwik's draught IPO documents, the company plans to raise approximately Rs 1,500 crore through a primary share sale, with the remainder raised through a secondary transaction in which existing investors will sell stakes. Singh and Upasana Taku intend to sell shares worth more than Rs 191 crore in the secondary market, according to the draught red herring prospectus (DRHP). Mobikwik, founded in 2009 by Singh and Taku, has investors such as Sequoia Capital India, Bajaj Finance, American Express, Cisco, and the Abu Dhabi Investment Authority.

Earlier on Friday, ET reported that Mobikwik's larger rival Paytm is also rushing to get Sebi approval for its $2.2 billion IPO and begin trading as a public company here before Diwali.