A slew of new Indian internet companies like Zomato, Paytm, PharmEasy and Nykaa are looking to go public. An article in the Ken recently pointed out that though India's addressable market for internet customers is at 1.4 billion, India's 'A-Level' mobile data users are just 15 percent of the active transacting customer base and account for nearly 40 percent of the money spent.

The worry is that these consumers cannot monetise beyond a certain point there seems to be a lot of froth if one just looks at the numbers of active users of the internet.

Praveen Gopal Krishnan, the COO at The Ken and Arvind Singhal, the Chairman at Technopak Advisors spoke to CNBC-TV18 to talk about these internet company IPOS and the opportunity they have in India.

“By my assessment, the number of active annual customers (AAC) accounts is in the range of probably between 70-80 million users in India at the stretch. It means that this is the number of users who have made at least one purchase in a year and typically they would have been done it at one of the big horizontal e-commerce platforms,” said Krishnan.

It is noteworthy that this does not include people who use UPI to make bank transfers, phone recharges etc. These are people who have gone and made at least one purchase. Singhal pointed out that this is less than 2 percent of Indian households.

"Let us say out of 300 million households in the country or about 280 million who even can be qualified by any standard as middle income by global standards, I am talking about Rs 25 lakh annual household income or more, just 2 percent. This means we are looking at no more than 5 million households in the country which have any kind of a significant purchasing power," he said.

Singhal does see the active internet consumers In India rising and added that it can double to 150 million odd. For that, however, growth is the key.

"A jump in annual active users will be much higher if the GDP grows," said Krishnan.

Watch the video for an in-depth analysis.

Also Read: STARTUP DIGEST: Paytm gets shareholders' nod for Rs 16,600-cr IPO, LIC plans to invest in Zomato IPO, Flipkart raises $3.6 bn

(Edited by : Abhishek Jha)