As Paytm, Zomato Tank After Listing, 2 Tech Start-ups Delay IPOs: Report

A growth in know-how preliminary public choices in India dangers grinding to a halt after a number of of the nation's highest-profile startups tanked quickly after itemizing.A raft of outstanding tech startups, together with Oyo Hotels and logistics supplier Delhivery, are pushing again their public debuts and getting ready to reappraise goal valuations, in accordance with folks aware of the scenario. The duo, each backed by SoftBank Group Corp., had been among the many nation's extremely anticipated choices.India's burgeoning startup ecosystem faces a reckoning simply weeks after it closed out a file 12 months for IPOs. Investors have soured on new tech choices after the calamitous public debut of fintech agency Paytm, in addition to the battering obtained by newly listed e-commerce operators Zomato Ltd. and Nykaa. IPOs have gotten off to a tough begin this 12 months from New York to London and Hong Kong amid prospects of interest-rate hikes, geopolitical tensions and elevated volatility. In India, the flops have smarted as a result of 2021 was to have been the huge and vibrant startup sector's coming-out celebration. Instead, regulators have stepped up scrutiny of IPO candidates after buyers acquired burned, contributing to the delays. “Investors are no longer enamored of the household name startups; they want a path to profitability and returns, not hype and hoopla,” mentioned Anup Jain, a managing companion at early-stage investor Orios Venture Partners. An Oyo spokesman mentioned by e-mail that it's customary process for the regulator to ask for clarifications of a preliminary IPO submitting, including “our bankers are actively engaged with them. We can't comment on specifics.” Delhivery declined to reply.The house owners of Delhivery have pushed again its roughly $1 billion IPO to the fiscal 12 months beginning in April, mentioned a number of the folks, asking to not be named as a result of the small print are non-public. Delhivery can also be reviewing its itemizing plan after the inventory market regulator frowned on a deliberate sale of a considerable quantity of shares by buyers within the IPO, the folks mentioned. The logistics startup, backed by Carlyle Group Inc. in addition to SoftBank, had beforehand deliberate to record by March.Oyo, which got here below scrutiny for its possession construction and heavy losses after submitting preliminary IPO paperwork final 12 months, is now dealing with regulatory questions too. India's watchdog has made queries about Oyo's ongoing litigation with hostel operator Zostel Hospitality Pvt, which is claiming a stake within the firm after a failed merger in 2016. The approval for the draft prospectus of Oyo's deliberate $1.2 billion IPO has been pending for nearly 5 months. Its buyers embody Sequoia Capital and Lightspeed Venture Partners, in addition to SoftBank.The administration and bankers of Oyo, formally referred to as Oravel Stays Ltd., are usually not in a rush, nevertheless, mentioned one of many folks. They are taking their time to answer the regulator's queries to decelerate the itemizing course of on objective, the individual mentioned.Also up within the air are the IPO timings of Pharmeasy, which works by API Holdings Ltd., and car market Droom Technology Ltd., which filed preliminary IPO paperwork in November. Pharmeasy's buyers embody Prosus Ventures and TPG, whereas Droom is backed by Beenext and Lightbox Ventures.Spokespeople for Pharmeasy and Droom declined to remark. Workers put together the stage through the itemizing ceremony for the IPO of One97 Communications Ltd., operator of PayTM, on the Bombay Stock Exchange in Mumbai, India, on Thursday, Nov. 18, 2021. One 97 Communications Ltd., which operates India's pioneering digital-payments model Paytm, fell in its buying and selling debut in Mumbai as buyers questioned the corporate's valuations and path to profitability.India's first-ever tech IPO rush marked a monumental 12 months of exits for world buyers in 2021. Paytm's father or mother firm, One 97 Communications Ltd., raised a file $2.5 billion when it went public in November. But its shares have plummeted 60% from their IPO value, infuriating buyers and fueling considerations amongst regulators. A broader decline in tech shares in India and past has solely added to the gloom. Even the US IPOs of startups Druva Inc, InMobi Pte and Pine Labs Pvt have been postpone or deferred to the second half of 2023 or later, a number of the folks mentioned. Sunnyvale, California-based software-as-a-service supplier Druva, Singapore-based cellular options startup InMobi and fintech Pine Labs have been all based in India, the place they nonetheless have the majority of their operations.A Druva spokesperson mentioned by electronic mail that “the company will continue to monitor market and industry conditions and will do what best positions Druva for future growth and success.”InMobi and Pine Labs didn't reply to requests for remark.Hanging over the Indian listings is a giant unknown: the destiny of the huge public share sale of state-owned Life Insurance Corp. of India, which filed its draft prospectus over the weekend. The last valuation and investor curiosity in what's being referred to as the “mother of all Indian IPOs” may dictate the course of know-how firms' itemizing plans, a number of folks mentioned.(*2*)Sandeep Murthy, a Mumbai-based companion at Lightbox, mentioned considerations amongst public market buyers are intensifying after two years of “rocketing” development.“Last year was all about greed and, short of an alien invasion, the market was ready to accept anything,” Mr Murthy mentioned. “Right now, fear is creeping up but give it some time, greed will be right back.”(Except for the headline, this story has not been edited by NDTV workers and is printed from a syndicated feed.)