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IPO is a significant milestone for startups, but should not be the ultimate goal, says expert
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IPO is a significant milestone for startups, but should not be the ultimate goal, says expert
Nov 16, 2023 2:52 PM

The recent listing of Honasa Consumer, the parent company overseeing the beauty and skincare brand Mamaearth, has instilled confidence in the startup ecosystem, signaling potential value realisation and encouraging investor exits.

In a discussion with CNBC-TV18, Nisha Poddar engaged with industry experts Karan Sharma (MD & Co-Head of Digital & Tech Investment Banking at Avendus Capital), Disha Singh (Co-Founder at Zouk), and Rahul Chowdhri (Partner at Stellaris Venture Partners). The conversation delved into the prevailing challenges for startups amidst a funding winter, exploring viable options and shedding light on the practicalities of deals in the startup landscape.

Karan Sharma emphasised that while an Initial Public Offering (IPO) is a significant milestone for startups, it should not be perceived as the ultimate goal. He anticipates around a dozen tech IPOs in the next 12-15 months.

"IPO is a key milestone for a startup but it is not the end outcome. We expect on the tech side about a dozen odd IPOs in the next 12-15 months as a lot of companies are now getting ready where they can be appreciated well by public market investors. The companies are turning profitable and that has always been a key factor for public listings in India. So companies are now getting ready where they could explore their public market phases," Sharma stated.

According to Rahul Chowdhri, the Indian investor places considerable importance not only on the size, scale, and growth of companies but also on their profitability. He interpreted Mamaearth's IPO as a convergence of these factors, indicating that the company's public offering symbolises substantial growth coupled with a commitment to achieving profitability.

Watch accompanying video for entire discussion.

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