ETtechPoor post-IPO efficiency of new-age startups additionally prompted lots of their friends to rethink their itemizing plans.
2022 vs 2021
Fund mobilisation via IPOs halved to just about Rs 57,000 crore in 2022.
The assortment would have been a lot decrease if not for the mega Rs 20,557-crore LIC public provide, which constitutes as a lot as 35% of the whole quantity raised in the course of the yr.
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In comparability, 1.2 lakh crore was raised by 63 firms in 2021, which was the perfect IPO yr in twenty years.
Indian tech startups
raised over $42 billion in 2021, as per Orios Venture Partners’ report titled ‘The Indian Tech Unicorn Report 2021’.
The nation noticed 46 unicorns in 2021 alone, pushing the whole variety of unicorns to 90.
The report, which dubbed 2021 “a landmark year for Indian startups going public”, famous that India homes the third-largest startup ecosystem on the earth with about 60,000 startups.
However, in 2022, the variety of new-age startup IPOs dropped to the low single digits. As many as 9 startups listed on the bonuses in 2021, whereas solely two — Delhivery and Tracxn Technologies — went public this yr.
Meanwhile, the record of startups that deferred going public grew longer because the months handed. Some of those had been Snapdeal, Ola, Droom, MobiKwik, PharmEasy, Oyo, BoAt and Flipkart.
According to knowledge from BSE, 88 IPOs had been launched year-to-date, with 36 launching on the primary board, whereas the remaining had been on the SME phase.
Delhivery and Tracxn Technologies had been the one two new-age know-how firms within the 36 IPOs.
The LIC IPO was the most important ever concern in India at Rs 20,557 crore, adopted by Delhivery (Rs 5,235 crore), Adani Wilmar (Rs 3,600 crore), Vedant Fashion (Rs 3,149 crore) and Global Health (Rs 2,205 crore).
Barring LIC and Delhivery, the big-size points had been negligible in 2022, with a median ticket dimension of lower than Rs 1,000 crore.
New-age startups proceed to bleed
In addition to the market volatility, startups additionally deferred their itemizing plans due to the efficiency of startups that went public in 2021, comparable to Zomato, Paytm and Nykaa.
According to trade specialists, these new-age firms took to the bourses at comparatively excessive valuations solely to see quick and sustained corrections.
The shares of One 97 Communications Ltd, the mum or dad entity of economic providers firm Paytm, plunged to Rs 474 on December 23. Meanwhile, Paytm shares are down by 75% since its itemizing on November 18, 2021.
The inventory crashed 27.4% on the primary day after itemizing and pictures of its teary-eyed founder and CEO Vijay Shekhar Sharma went viral.
Shares of meals supply platform Zomato, the primary startup unicorn to go public in 2021, additionally took a beating as traders expressed issues over profitability and excessive money burn. The inventory was down 53%, buying and selling at Rs 58.65 as of December 24, 2022.
FSN Ventures, the mum or dad entity of magnificence etailer Nykaa, is down round 56% year-to-date, whereas PB Fintech, which runs Policybazaar, is down 53%.
Logistics and provide chain firm Delhivery’s shares have dropped by 40% for the reason that firm’s itemizing in May.
Collectively these 5 tech companies have wiped over $18 billion of traders’ wealth since itemizing, as per a
Bloomberg report.
Unicorn occasion ends
According to knowledge compiled by Finbold, the variety of unicorns in India dropped to 85 in 2022 from greater than 100 in late 2021, amid world financial turmoil.
As per knowledge from Venture Intelligence, India has
102 unicorns as of December 2022.
The tempo of startups turning unicorn additionally dropped in 2022 with solely 21 coming into the coveted membership.
ETtechExpectations for 2023
While the funding winter could also be round for a while, the IPO market could also be in for a busy yr. Companies nonetheless want entry to the markets, and enterprise capitalists will nonetheless have to money out.
Optimism for subsequent yr can be pushed by the outlook for the Indian financial system, which is projected to develop by 6% in FY24, making it the world’s fastest-growing main financial system.
Moreover, as per a report by market analysis and consultancy agency Redseer,
80 startups have the potential to go in for public itemizing within the subsequent 5 years.
“India may see over 100 mature, large-scale profitable/path-to-profitability start-ups in the next five years. With about 20 of them already being listed, about 80 start-ups have the potential to look at an IPO journey,” Redseer mentioned within the report.