Why Startup IPOs Without Profitability Path Concern Sanjeev Bikhchandani

Info Edge's Sanjeev Bikhchandani doubts the public market reception of loss-making companies without clear profit visibility in the near future.

“After 2022, market correction, while technically loss making companies can go public. I am doubtful about how receptive public markets will be of loss-making companies unless there is a clear visibility on profits in the next year or two." 

"I am not sure people will be willing to give valuations that these companies often expect. But I could be wrong,” Bikhchandani said during a conference call for Info Edge’s announcement of its third-quarter financials.

Bikhchandani added that the increase in the share prices of portfolio companies like Policybazaar and Zomato over the past 6-12 months aligns with improvements in the companies’ bottom lines.

He further mentioned that during a financial shortage, breaking even becomes essential, and he believes a sufficient number of companies are accomplishing that.

Info Edge’s Sanjeev Bikhchandani Sceptical About Startups Eyeing IPO Without Path To Profitability