MUMBAI: New-age tech IPOs are cashing in on bullish inventory market sentiments after anearly three-year lull. With practically Rs 15,000 crore to this point, this year has turned out to be the best for IPO fund-raising since 2021, when the primary wave of massive startup listings, together with Paytm, Zomato & Nykaa, had hit the markets.
Six new age tech startups, together with Ola Electric and FirstCry, have gone public this year elevating a mixed Rs 14,571 crore, in line with Prime Database and trade knowledge.In 2021, seven startups had collectively raised Rs 42,826 crore by way of IPOs (see graphic) . Swiggy and MobiKwik whose IPO filings have been green-lighted by markets regulator Sebi not too long ago are additionally in the IPO queue.
Swiggy’s Rs 10,000-crore IPO, which is prone to be upsized to Rs 11,700 crore subsequent week, would be the second-biggest startup IPO after Paytm’s Rs 18,300-crore IPO launched in 2021. Logistics startup Blackbuck and electrical two-wheeler maker Ather Energy have additionally filed draft IPO papers as corporations look to money in on sturdy public markets. Since 2019, about 21 new age tech corporations have collectively raised Rs 67,515 crore by way of IPOs, the info confirmed.
New age tech IPOs are anticipated to make up 20-30% of the $15-20 billion price of IPOs estimated to hit the road in the second half of FY25, Neha Agarwal, MD & head, fairness capital markets at JM Financial Institutional Securities instructed TOI. In H1FY25, the markets noticed about $7-billion price of IPOs.
“With most startups that got listed in 2021 having now delivered operating profitability with strong visibility on PAT (profit after tax) profitability too in the coming quarters, public market investors have finally understood that these businesses can turn profitable and questions regarding the sustainability of business models do not exist anymore,” mentioned Agarwal.
The rush of latest age IPOs comes after a few three-year lull when a broader international tech downturn had nudged a number of startups to go gradual on public itemizing plans with com panies like Snapdeal and Oyo having withdrawn their IPOs. Between 2022 and 2023, solely 5 corporations received listed, in line with the info. The first wave of massive startup IPOs was seen in 2021 when shopper subscription for digital providers surged on the again of Covid.
Gaurav Sood, MD and head, fairness capital markets at Avendus Capital mentioned that about $75-100 billion of tech market cap is estimated to be added to the general public markets over the subsequent three years. “After listing, with the churn of cap tables, we have seen domestic asset managers taking up larger stakes in new age companies. This year is poised to be strong for digital companies… with many more gearing up to file their draft papers,” Sood mentioned.
A slew of startups like Zepto and PhysicsWallah are eyeing market debut in the approaching year. The secondary market is at an all time excessive. A bullish secondary market is all the time accompanied with heightened main market exercise, mentioned Pranav Haldea, MD at Prime Database Group.
