IPOs in 2024: Unveiling top investment opportunities
From Swiggy's food delivery dominance to Ola Electric's revolutionary e-mobility vision, we present 5 top IPOs of 2024 ready to offer unparalleled investment opportunities in the Indian market. Read along.
2023 was marked by diverse performances and insightful lessons; we witnessed both meteoric rises, like Nextracker's 25% surge upon launch, and humbling challenges, as Instacart faced headwinds in the competitive grocery delivery space.
Despite the broader world facing macroeconomic challenges and global geopolitical tensions, the Indian equities market experienced a revival in IPO activity, marking a notable improvement from the subdued atmosphere of 2022. The surge in new-age tech startups entering the Indian public domain increased from 3 in 2022 to 5 in 2023 along with a historic milestone– an all-time high of 5.98% of global IPO shares (as as reported by Dealogic), reflecting a positive shift in investor sentiment. Furthermore, the country's share of Asia's IPO has surged to 9.9% in the current year, marking significant growth from 5.9% in 2018, according to Reuters.
With the ongoing bullish trend in the domestic equity market and a robust pipeline of startups eyeing public offerings, expectations point to a significant uptick in new-age tech IPOs for the year 2024.
From Swiggy's food delivery dominance to Ola Electric's revolutionary e-mobility vision, we present 5 top IPOs of 2024 ready to offer unparalleled investment opportunities. But remember dear investors, valuations must be fair, and growth trajectories must be well-defined. Without further ado, let’s get started.
Swiggy
Backed by SoftBank, Swiggy is gearing up for its anticipated IPO in early 2024, with plans to raise approximately $500 million. The IPO serves as a strategic move for SoftBank to divest its stake in the company. Valued at $10.7 billion, stands as a key player in India's food delivery sector, poised to make a significant market impact with its IPO.
This move follows in the footsteps of its rival, , marking a notable milestone in Swiggy's growth journey.
FirstCry
Pune-based startup , a prominent childcare online platform, is poised to make its market debut with an anticipated IPO in 2024, following the outcome of the 2024 Lok Sabha elections.
With aspirations to secure approximately $500-600 million through its IPO, FirstCry's parent company, BrainBees Solutions, has recently filed a draft red herring prospectus (DRHP) with SEBI. The IPO includes a fresh issue of shares, aiming to raise ₹1,816 crore, and an offer-for-sale (OFS) of 5.4 crore equity shares, featuring major stakeholders such as SoftBank and Premji Invest, along with founder Supam Maheshwari divesting a portion of his stake.
The funds generated from this IPO will be strategically allocated for initiatives such as establishing new stores and warehouses in India, lease payments for existing stores, expansion into Saudi Arabia, and investments in subsidiaries and technology.
Ola Electric
Electric vehicle startup Ola Electric is charting its IPO course, targeting a launch in January or February 2024, with plans to raise approximately $400 million.
The funds raised are designated for the establishment of 's inaugural factory in Tamil Nadu. As the EV arm of , this IPO is poised to be a highlight in 2024, aspiring to secure between $700 million and $800 million, potentially valuing the company at $7 billion-$8 billion. Notably, this marks India's first IPO in the motor sector in nearly two decades.
Despite challenges in safety and customer service, Ola Electric has experienced remarkable revenue growth, transitioning from a cab aggregator to a prominent EV manufacturer. Its commitment to sustainable transportation aligns with the growing market trend towards green energy.
Oyo IPO
The eagerly anticipated IPO of Rooms has taken a significant step forward with the pre-filing of its draft paperwork, projecting a mid-2024 launch, according to Inc42.
This IPO is expected to amass around $400 million for Oyo Rooms, a pivotal move for the travel-booking platform aiming to alleviate a substantial portion of its debt through public funding. Although the initial IPO filing was followed by a refiled draft red herring prospectus (DRHP) under a confidential pre-filing route, there have been reports of a noteworthy reduction in the public listing's issue size, now ranging between $400 million and $600 million, exclusively through a primary issuance.
PharmEasy
The Tata-owned is expecting a potential public offering, building on its strong financial performance. Having recently secured over ₹3,950 crore through a successful rights issue under the Tata umbrella, PharmEasy has achieved EBITDA positivity in Q1FY24. Pending approval from the Competition Commission of India (CCI) for the rights issue, Ranjan Pai is poised to become a holder of approximately 15% of PharmEasy.
The funds garnered from the rights issue are earmarked for debt reduction, fueling the company's organic growth initiatives.
The “front page of the Internet”– , is actively exploring an overdue initial public offering (IPO), currently in discussions for a potential IPO as early as the first quarter of 2024, with an anticipated valuation of $15 billion.
Despite having gathered over $1 billion in funds to date, Reddit's move towards an IPO gained traction after a significant financing round in 2021. While the company confidentially filed for an IPO with the Securities and Exchange Commission in December 2021, concerns around profitability and other issues may have delayed its IPO plans.
Although investor markdowns have affected Reddit's valuation since August 2021, the company reportedly seeks a valuation as high as $15 billion for its anticipated debut in 2024, as per reports from Bloomberg.
Stripe
, the San Francisco-based financial services company renowned for its online payment solutions, is poised for a significant milestone with its anticipated initial public offering (IPO) through a direct listing. Established in 2009 by the Collison brothers, Stripe's IPO has generated considerable anticipation within the financial market. Despite facing challenges, Stripe has demonstrated robust growth, registering an impressive 60% increase in 2021.
Stripe's success is notably attributed to its payments processing business catering to the e-commerce sector. The company has garnered substantial support from major venture capital firms such as Kleiner Perkins, Andreessen Horowitz, and Sequoia Capital, achieving a notable valuation of $95 billion in 2021. However, it's worth noting that a $6.5 billion fundraising round in March 2023 valued the firm at $50 billion.
The industry has been abuzz with rumours about Stripe's impending IPO for some time, adding to the anticipation surrounding the company's public debut.
Shein
Shein, the Chinese fast-fashion behemoth, has confidentially submitted documents for a prospective US Initial Public Offering (IPO), aiming for a listing as early as 2024 with an estimated valuation ranging between $60 billion and $90 billion. Renowned for its disruptive retail strategies, Shein's ascent to prominence has not been without its share of controversies, particularly facing scrutiny over labour practices and its connections to Beijing.
Anticipated to be a landmark event, Shein's potential IPO in 2024 could become one of the largest in global history. The company has already initiated confidential filings with the Securities and Exchange Commission (SEC) to facilitate the offering. In 2023, Shein boasted a valuation of $66 billion, but it aims to secure a valuation as high as $90 billion for its IPO, as reported by Bloomberg.
While sustaining such valuations demands exceptional operational performance, Shein has showcased robust growth, with year-over-year sales surging by over 40% in the initial three quarters of 2023, reaching an impressive $24 billion.
Strap in, investors! The stage is set for an exhilarating journey into the future of Indian markets. Stay tuned for the next big wave of success with these upcoming IPOs.