New-age Companies Eye IPOs Amid Market Uncertainty
As 2025 approaches, new-age companies in India are preparing for public market debuts. However, they face challenges that may affect their valuation expectations and IPO timing. Geopolitical uncertainties and fluctuating market conditions are causing many startups to reassess their strategies. Companies like Zepto, PhysicsWallah, and OfBusiness are among those looking to make their mark on the stock exchange. Additionally, Ather Energy has already filed its draft IPO papers with the Securities and Exchange Board of India (Sebi).
Market Conditions and Valuation Concerns
Recent developments in the global economy have raised concerns about the valuation of new-age companies. Neha Agarwal, Managing Director and Head of Equity Capital Markets at JM Financial Institutional Securities, highlighted that the Indian markets have been choppy. This instability, combined with narrowing benefits over China, has led to increased valuation scrutiny. The recent election of Donald Trump in the United States has also introduced uncertainties. His anticipated pro-growth policies may cause global asset allocators to be more cautious about investing in emerging markets.
Abhinav Bharti, MD at JP Morgan India, echoed these sentiments. He noted that external factors could lead to adjustments in IPO valuations. Despite these challenges, he believes that overall IPO activity will continue, supported by strong domestic fundamentals. The Indian market’s resilience may help new-age companies navigate these global headwinds.
Successful IPOs and Future Prospects
The IPO market has seen significant activity from new-age companies this year. Major players like Ola Electric, FirstCry, and Swiggy have successfully listed on the stock exchanges. Swiggy, for instance, had to adjust its valuation from an initial target of $13 billion to $11.3 billion due to market conditions. Nevertheless, its IPO raised ₹11,327 crore, making it the second-largest public issue of the year, following Hyundai Motor India’s ₹27,870 crore IPO.
In 2024 alone, new-age companies have raised over ₹25,000 crore through IPOs, marking their best fundraising year since 2021. The success of Swiggy and FirstCry has encouraged other companies to expedite their listing plans. Bharti noted that many firms are actively evaluating their readiness for public markets. There is also a growing trend of companies re-domiciling to India, which is particularly appealing for startups seeking to be listed on Indian exchanges.
The Road Ahead for New-age Companies
Looking forward, new-age companies are expected to play a significant role in the IPO landscape of 2025. Investment bankers predict that technology firms, along with those in consumer and financial services, will dominate public listings. Gaurav Sood, MD and Head of Equity Capital Markets at Avendus Capital, emphasized that public markets are becoming increasingly attractive for these companies. They provide access to substantial growth capital that private markets may not offer.
Sudarshan Ramakrishnan, Co-Head of India Investment Banking at Goldman Sachs, anticipates that India’s overall equity issuance in 2025 will surpass that of 2024. He attributes this growth to robust economic conditions, a burgeoning middle class, and ongoing digital transformation. As new-age companies continue to mature, they are likely to make up about 15-20% of the estimated $10-15 billion expected to be raised through IPOs in the coming months.
Observer Voice is the one stop site for National, International news, Editor’s Choice, Art/culture contents, Quotes and much more. We also cover historical contents. Historical contents includes World History, Indian History, and what happened today. The website also covers Entertainment across the India and World.