8 Startup IPO Predictions For 2024

SUMMARY

The number of new-age tech startups going public rose to 5 in 2023 from just 3 in 2022 on the back of improvement in investor sentiment

Considering the current bull run in the domestic equity market and a healthy pipeline of startups aiming to go public, the year 2024 is expected to see a sharp increase in new-age tech IPOs

While the IPOs of Swiggy and Ola Electric will be among the most awaited ones, experts believe that reasonable valuations and profitability will decide the success of public issues

The year 2023 turned out to be much better for initial public offerings (IPOs) in the Indian equities market on the back of the bullish sentiment in the broader market. Despite macroeconomic headwinds and global geopolitical tensions, the domestic IPO market saw a revival this year after the lull of 2022. The public issues of new-age tech startups also saw a sharp improvement in demand in 2023 compared to a listless 2022. Despite at least 10 startups either filing DRHPs or announcing IPO plans, they didn’t make any progress last year as the market remained tumultuous. Even this year, many of them continued to defer their IPO plans. However, experts suggest that the number of new-age tech IPOs will rise in 2024 despite the startups continuing to be cautious about the timing of going public.Deepak Shenoy, founder and CEO of Capitalmind, said that the current market is a bull market. This will result in the success of IPOs and lead to more such public issues in the next year. According to him, the chances of a big fall in the markets in the near term seem very low, despite the ongoing geopolitical tensions, high-interest rates in the US, and other macroeconomic uncertainties. This will encourage companies to take the IPO route.In the third category would be Zomato’s rival Swiggy, which has started its IPO preparations and recently hired investment bankers. Prosus-owned PayU and Peak XV Partners-backed Awfis are also said to be looking to soon file their draft IPO papers, while drone startup Garuda Aerospace is eyeing a mid-2024 listing.“Technically, while we are eloquent about the current IPO situation, this is a dip in the ocean in comparison to what was earlier,” he said, adding that the size of Paytm’s IPO was much higher than many other recent IPOs combined together. “Generally, people are a little bit cautious and wait for big political events to take shape. When you have something this substantial coming up, I think people normally like to wait and see the outcome before they make big decisions and IPOs are normally very big decisions… Investors also wait on the sidelines,” Bhargava said while explaining the rationale of the companies.“Businesses today need to have strong growth, profitability or at least a clear path to profitability… it doesn’t matter which sectors they belong to… Profitability today is the biggest ask from the public market investors,” Lightspeed’s Bhargava said.Speaking on the issue after Mamaearth’s listing, Tapse said that this is a market where companies should create value for shareholders and not for themselves.Commenting on this, Bhargava said, “We would want all leading Indian companies to list in India and give domestic investors the ability to be part of their growth and value creation journey… the valuations and the investor following the tech companies will get in India are far superior to their prospects in other listing locations.”Speaking on the matter, Mukesh Kochar, national head of wealth at AUM Capital, said that the listing of a number of recent IPOs at a steep premium to their issue price has made public issues attractive for investors looking for short-term capital gains. This trend is expected to continue next year and push up IPO subscriptions.

But before we delve deeper into the IPOs of new-age tech stocks, let’s take a quick look at the overall IPO landscape. 

No results were found for "".
  • «
  • 1
  • »
modal lock

Continue Reading With A Free Inc42 Account

Get the most out of your Inc42 experience by creating a free account. Enjoy personalized recommendations, ad-lite browsing, and access to our exclusive newsletters.