Two firms look at US listing, even as startups get a boost in India

MUMBAI: Even as market regulator, the Securities and Exchange Board of India (Sebi) lays down the red carpet to encourage startups to list in India, two of the country’s fast-growing first-generation startups, IBS Software Services and InMobi, are conducting preparatory work for a public float in the US.

According to people familiar with the development, the two firms, which are cumulatively valued at more than $4 billion, are talking to bankers for the issue, which will also give its current private equity investors opportunity to exit.

Thiruvananthapuram-based IBS, a market leader in software solutions for aviation, did not respond to queries mailed by HT, while mobile ad tech company InMobi declined to comment.

“Preparatory work is on as a US listing is a long-drawn program,” a merchant banker said. “There are typically a number of steps to follow. These days it’s also allowed for companies to interact with potential investors to gauge sentiment,” he added.

PE major General Atlantic is looking at a valuation of about $200 million for the $60 million it had put in IBS in 2007. InMobi which is competing with Google, is two-thirds owned by a clutch of investors, including Softbank and Kleiner Perkins.

“While Sebi’s norms are positive, it will take time for Indian markets to evaluate startups,” said Harish HV, partner, Grant Thornton. “The new norms will help the next generation of e-commerce firms.

“The US market, through Nasdaq, is the most advanced market for technology companies. So it is natural that such firms will want to go there,” said V Srinivasan, founder, CFO Bridge.

SEBI HAD COME UP WITH NEW LISTING NORMS ON JUNE 24 FOR STARTUPS, SUCH AS SPECIALISED INSTITUTIONAL TRADING PLATFORM & EXEMPTION FROM DISCLOSURES