A flurry of IPOs set to hit India in 2021
NEW DELHI: India’s internet economy is set to attract massive investments as several players such as food-delivery startup Zomato, courier service provider Delhivery, Walmart-owned Flipkart, and e-tailer Nykaa are expected to enter the public market in 2021.
“More than $60 billion has been invested in India’s internet startups in the past five years, with around $12 billion in 2020 alone. Many of these leaders, which operate businesses are now on the cusp of listing,” HSBC Global Research said in a February 2021 report.
In a January report, Citi Research said that it expects IPOs to accelerate in 2021, aided by improving profitability and scale in various verticals. Internet sub-segments such as e-commerce and edtech, combined with penetration of wireless subscribers and improved quality by telecom operators are likely to drive growth, analysts said.
Analysts at HSBC estimate that the total value of the country’s internet economy could cross $180 billion by 2025, while analysts at Citi Research estimate the market to be worth $639 billion by 2030.
E-commerce is expected to lead the growth in the internet economy. Analysts said while Amazon.com Inc and Flipkart dominate the space with 80% market share, India’s e-commerce is still evolving. The entry of Mukesh Ambani-owned Jio Platforms Ltd, with its online retail business, could stiffen competition and threaten existing players.
Jio Platforms houses RIL’s telecom business Jio and a slew of other digital services such as online grocery delivery, healthcare, payments, gaming, cloud. Citi Research said that it expects public market listings to accelerate in 2021, aided by improving profitability and scale in various verticals, OTT content, music, video conferencing, etc.
Mint had on 18 January reported that Reliance Retail Ventures Ltd plans to embed its e-commerce app JioMart into WhatsApp within six months, allowing the 400 million users of India’s most popular messaging service to order products without having to leave the app.
“Jio is set to emerge as a significant threat, along with multiple vertical e-commerce players and hundreds of brands that are now delivering direct to consumers. We believe Reliance Jio, a relative newcomer, will become a stronger competitor, because of its offline retail presence (over 12,000 stores across 7,000 cities),” HSBC said.