Around 20 startup unicorns are going to launch IPOs in the upcoming years

Startup unicorns are going to launch IPOs

After a lukewarm year of Indian startups delaying their listing plans in the middle of the global tech slowdown as well as choppy markets, various new-age firms are planning to come back to the public markets.

Around 15-20 startup unicorns are planning to launch IPOs or initial public offerings in the next two years, according to senior officials of Kotak Investment Banking.

Major companies such as Ola Electric, FirstCry, or MobiKwik have filed draft IPO papers with Sebi. These companies are going to be the first ones to get listed on the bourses in 2024. ‘Funding Winter is going to end in 2024 along with a public market dynamism return.’

Massive internet IPOs will catalyze when it comes to board deal-making, according to V Jayasankar, who is the managing director as well as Kotak Investment Banking’s member of the board. This was said at a press briefing. 

The current scenario for startups 

The startups have been dealing with a serious funding crunch. The investments have declined to $8.2 billion in 2023, which is a seven-year low. This is compared to the $25 billion in funding that firms collectively got from various investors in 2022.

No wonder the investment narrative is changing for startups. They are shifting from growth at any cost to experiencing profitable growth. Various companies are working to reduce their losses and are working dedicatedly to have profitability. 

Various startups are deciding to go public.

Apart from this, companies that are deciding to go public, experience profitability is highly important to win market confidence, as indicated by the performance of Zomato after turning profitable.

Other sectors, like used-car platforms, hold the potential to become highly profitable in the upcoming years. Whereas, other segments such as quick commerce, omni-channel e-tail, or B2B commerce are in a better financial state, according to Kotak officials.

‘Some of the excesses in the startup segment have been engaged via corrections. Various Indian startups have turned out better than their global counterparts when it comes to focusing on profitability. Major companies have worked and changed their model where no profits were expected in the next five years, according to Jayasankar.

Various OPI-bound companies, such as MobiKwik and Oyo, have experienced profitable quarters in the fiscal year of 2024.

Kotak is estimating that India is going to have more than 10 internet decarons or startups with around $10 billion valuation and even more by the end of 2025. ‘Equity of around $10 billion is expected from the IPO market in the next one to two years.’