India’s startup environment is getting ready to be the centre of attention when it comes to new IPO issues, with estimates saying that almost 80 tech startups worth about $100 billion plan to go public in initial offerings by the year 2027. This expected boom shows the country’s increasing place as a world center for new ideas and business.
A Flourishing IPO Landscape
There has been a tremendous increase in startup IPOs in India in recent years. During 2024 alone, 13 new-generation companies got listed on the stock exchange, raising over ₹29,200 crore. This was an increase compared to earlier years, with 10 IPOs having listed in 2021 and six in each of 2022 and 2023. Among the notable listings were Swiggy, Ola Electric, and FirstCry, of which Swiggy’s IPO was the largest at ₹11,327.43 crore.
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According to a Redseer Strategy Consultants report, India can expect to see over 100 of its large-scale, mature startups turn profitable or achieve profitability in the next five years. With perhaps 20 of them already listed, perhaps 80 of the startups will begin their IPO journey by 2027.
Relative to this, new-age companies or technology comprise only about 1% of India’s $3.9 trillion market cap, whereas in the U.S., they account for 25% of a $43 trillion market. This skew suggests vast growth potential for Indian tech startups listed in the public market.
Regulatory Reforms Facilitating Growth
The Indian government has introduced regulatory reforms to help the process for foreign domicile startups to return and list locally. These reforms have reduced the time from 12-18 months to roughly 3-4 months, which has led to startups like Razorpay, Pine Labs, and KreditBee considering shifting their domiciles back to India.
Investor Sentiment and Market Dynamics
Indian startup investor confidence remains firm. Dutch technology investor Prosus NV, for instance, is anticipating a dramatic rise in adjusted profit in its e-commerce businesses and believes it will see more of its Indian investments, like PayU, Meesho, Urban Company, Pharmeasy, and BYJU’S, list within the next 12 to 18 months.
Besides, the Bombay Stock Exchange (BSE) expects the record-breaking IPO run to continue unhindered in 2025 with a huge pipeline of over 90 companies planning to raise close to ₹1 trillion.
Challenges and Considerations
The startups take on, even in the rosy picture, company profitability, strict regulator norms, and fluctuating market volatility. Take the recent instance of regulation tightening in derivative trading which led to a 40% notional value decline in derivatives traded on BSE. This shows how responsive the market can be to any kind of regulatory action.
Conclusion
A large number of startups going public by 2027 is indicative of a massive change in India’s tech startup ecosystem. This does reflect not only the growth and maturity of Indian startups but also a broader shift in the tech landscape around the world that is making India a leading participant in the global markets.
