Report Reveals Valuation of $90 Billion for 40 Tech Companies Listed in India
India’s capital markets are witnessing a significant transformation as digital-first companies are relocating their headquarters back to the country. A recent white paper from Bay Capital Investment Advisors reveals a trend known as “reverse flipping,” where startups that previously registered in countries like the US, Singapore, or the Netherlands are returning to India. This shift reflects growing confidence in the domestic market, improvements in regulations, and an expanding base of investors.
Rise of Domestic Listings
Approximately 40 Indian consumer internet and technology firms have made the move to list domestically, amassing a collective market value of around $90 billion. Notable companies such as PhonePe, Groww, Zepto, Flipkart, Razorpay, Pine Labs, Udaan, Meesho, KreditBee, and InMobi are either returning to India or considering it, with plans to list on Indian exchanges. This trend highlights a renewed faith in India’s economic landscape, as these firms seek to capitalize on the growing investor interest in local markets.
The increase in public listings is noteworthy. In 2024 alone, 327 firms raised ₹1.5 lakh crore through public offerings, a stark contrast to the mere ₹20,628 crore raised in 2020. This surge includes significant digital enterprises like Swiggy, FirstCry, Ola Electric, Unicommerce, and TBO Tek, all of which have launched their public offerings, signaling a robust appetite for technology-driven growth opportunities among investors.
Factors Driving the Shift
Several factors contribute to this trend of reverse flipping. Indian investors have become adept at evaluating digital businesses using key performance indicators such as customer acquisition cost (CAC), lifetime value (LTV), and user retention. Additionally, reforms implemented by the market regulator, Sebi, have allowed high-growth companies, even those operating at a loss, to access public markets more easily. The increased participation of mutual funds, pension funds, sovereign wealth funds, and family offices has further bolstered the investment landscape, creating a more favorable environment for startups.
Bay Capital’s report emphasizes the importance of India’s sophisticated digital infrastructure, which includes systems like UPI, Aadhaar, ONDC, and the Account Aggregator framework. These elements are seen as crucial drivers of the current trend, enabling startups to thrive in a competitive market.
Growth in Deep Technology Sector
The trend of reverse flipping is not limited to consumer internet companies; it extends into India’s deep technology sector as well. Startups focusing on artificial intelligence, quantum computing, space technology, and enterprise software are securing significant funding. According to data from Nasscom-Zinnov, deep tech startups raised $1.6 billion across 310 deals in 2024, marking a 78% increase year-on-year. Notably, nearly half of this investment was directed towards AI ventures, underscoring the sector’s rapid growth and potential.
While Bay Capital expresses optimism about India’s digital and technological future, it also advises caution in investment selection. The report stresses that investors should focus on robust business models, unique competitive advantages, a healthy organizational culture, and sustainable profitable growth when evaluating potential investments in the country.
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