The year 2021 may witness a wave of IPO listings in India of major startups. Several Indian startups like Policybazaar, Flipkart, Zomato, Delhivery, Freshworks, Nykaa, and many others are eyeing public markets in 2021.
The IPO market in India has realized the potential of startups that are gathering large market share in various segments and are disrupting the traditional way of doing business. SEBI (Security and Exchange Board of India) has set up an IGP (Innovators Growth Platform) and has recently announced a consultation paper looking for annotations for new rules that will boost startups to head for IPO. The IPO debuts of Happiest Minds, Burger King, and Mrs Bector in the Indian stock market in 2020 have brought about the confidence in emerging startups to head for public offerings.
IPOs (Initial Public Offering) is considered a sign of maturity and from a startup’s perspective, it is almost like a badge of honor. Besides a few exceptions like IndiaMart and Makemytrip, startups in India have failed to go public. With weak business models that yielded losses each year, Indian startups could not go public. However, this is now changing, though slowly. Many startups have now announced their plans to list their shares this year.
Here are a few upcoming IPO listings in India of startups
IPO has become more lucrative with new norms being announced by SEBI such as decreased holding period, easier migration to the main board, and special rights.
This Indian foodtech unicorn’s IPO is being one of the most talked about IPOs of 2021. Presently being valued at $3.9 billion, the company has closed pre-IPO funding of $660 million. The company’s ability to bounce back from the crisis in 2020 where there was almost no revenue, has given many startups more strength to face the demanding public market. For the financial year 2020, the company’s revenue has doubled to $394 billion, however, the losses rose about 5% during the pandemic.
An e-commerce giant of India, Flipkart is heading for a US IPO. The company’s last valuation was at $24.9 billion and according to company reports the IPO debut could be reportedly worth $10 billion. The COVID-19 pandemic has accelerated online buying and digitalization, and Walmart-owned Flipkart has gained from it.
Delhivery, a logistics startup backed by Soft Bank Group Corp. plans to raise up to $800 million through an initial IPO in 2021. The company’s IPO is expected at a valuation of $32.4 billion which is almost double of what Soft Bank invested in 2019. According to recent reports, the company processes more than 1.5 billion orders per day and closed the year 2020 with Rs 2800 crore as revenue.
In November 2020, Freshworks had tripled its valuation to $3.5 billion which according to reports was believed to be the last private fund round before the company heads for US NASDAQ initial public offering in 2021.
The insurance unicorn, Policybazaar is also looking for an IPO in 2021. The company wants to go public at a valuation of $3.5billion. With SoftBank Group Corp’s Vision Fund, Tencent Holdings Ltd., and Tiger Global Management as its largest backers, Policybazaar may become the country’s first digital-era upstarts to head for IPO. The company intends to list in Mumbai but might go for dual listings as there has been a change in the rules.
This beauty e-commerce giant is also heading for initial public offerings in 2021. The startup headed by Falguni Nayyar entered the unicorn club in 2020 and has managed to raise investments from Fidelity Management & Research Company, a Boston-based asset management company, Steadview capital, and also from Bollywood celebrities- Katrina Kaif and Alia Bhatt. In the financial year 2019, the company’s revenue doubled to Rs 1150 crore.
The above are the few candidates for upcoming IPO listings in India. However, there are a few other startups like Pepperfry, Lenskart, Paytm, Mobikwik, Oyo which may also head for an IPO debut, however, there has been no set timeline specified by these companies as yet.
According to experts, in 2021 funding will continue to be strong due to the surplus in available capital. The speed of vaccination drive which has already started in the country last month, the fate of proposed IPOs by leading startups, the strength of consumption, and the performance of companies would determine the funding further. However, if these startups are able to pull off successful Initial Public Offerings, it will bring about a significant change that will lead to more capital for Indian Startups.