The Indian startup ecosystem has witnessed record-breaking activity in 2024, with 13 innovative companies launching initial public offerings (IPOs) and collectively raising over Rs 29,200 crore from the stock market. This dramatic surge marks the highest number of IPOs for startups in recent years, reflecting growing investor confidence and enthusiasm.
Comparatively, the year 2021 saw only 10 startup IPOs, followed by six IPOs each year in 2022 and 2023. This year’s unprecedented performance brings renewed vigor to the market, showcasing startups' potential to garner sizable investments. Of the total Rs 29,247 crore raised, approximately Rs 14,672 crore came from fresh issues, which directly benefit the companies by providing new capital for growth and operations.
The rising trend of IPOs is underpinned by the simultaneous inclusion of several high-profile startups among the listings. Notable companies such as TAC Security, Unicommerce, MobiKwik, TBO Tek, Ixigo, Trust Fintech, FirstCry, Menhood, Awfis, Swiggy, Digit Insurance, Blackbuck, and Ola Electric entered the market with significant offerings.
Leading the pack, Swiggy, the popular online food delivery service, secured the largest IPO by raising Rs 11,327.43 crore. Swiggy's market debut was quite successful, with its shares listed at Rs 420, reflecting a premium of 7.69%. Following Swiggy were Ola Electric which raised Rs 6,145.56 crore, and FirstCry, which amassed Rs 4,193.73 crore. Other significant IPOs included Digit Insurance at Rs 2,614.65 crore and TBO Tech at Rs 1,550.81 crore.
Among the 13 startup IPOs, 10 were mainboard offerings, and 3 were targeted at small and medium enterprises (SME). The notable subscription rates highlight the booming interest; for example, Unicommerce attracted subscriptions of 168.39 times, followed by MobiKwik at 119.38 times, Awfis at 108.56 times, Ixigo at 98.34 times, and TBO Tek at 86.7 times.
Interestingly, TAC Security achieved the highest listing gains at 173.58%, followed by Unicommerce and MobiKwik with gains of 117% and 57.71%, respectively. This surge indicates positive market sentiment and the potential for these companies to grow alluringly for investors.
India's IPO boom is indicative of the larger trends within the startup ecosystem. The health of this sector is also supported by substantial secondary transactions and block deals, which amounted to over $5 billion this year. This momentum is predicted to escalate, with expectations of doubling the number of IPOs by 2025 as more startups prepare to list publicly.
The growing venture capital (VC) domain complements the thriving IPO market, with over 30 new VC firms setting up shop this year. Many of these firms are led by seasoned entrepreneurs and investors who bring valuable experience from their previous ventures. Noteworthy new entrants include MudhalVC, Playbook Partners, BlueGreen Ventures, Promaft Partners, Optimistic Capital, and Zeropearl.
Although India now stands as the world’s third-largest startup ecosystem with 1,812 VC firms, trailing only the US and China, experts caution potential investors to remain vigilant. They stress the importance of differentiation among firms, highlighting the need for compelling strategies—be it through sector expertise, founder networks, or operational effectiveness—to survive and thrive.
Government initiatives like Startup India and favorable tax incentives for alternative investment funds (AIFs) have substantially contributed to creating this conducive atmosphere. This ecosystem not only attracts domestic capital but also appeals to international investors eyeing the booming market.
The rise of Indian startups through successful IPOs and the influx of fresh capital accentuate the potential of the economy, stimulating growth and job creation. With investor interest poised to remain high and new listings on the horizon, 2024 signifies both the current success of Indian startups and their promising future.
