Hottest 5 Pre-IPOs from India to Track in 2023

In 2021, India has seen many IPOs driven by genuine investors. A total of 1.3 trillion rupees (tn) of money came from IPOs last year. But the same momentum could not continue this year. So far, only a total of 618.5 billion rupees (billion) has been raised from the IPO, less than half of what the market saw last year.

The decline in IPOs is explained by weak investor sentiment in the context of high market share caused by geopolitical tensions and weak macroeconomic indicators.

But as the market recovers, the IPO rush is poised to start again. Here are five IPOs that could hit the market in 2023.

1 - OYO

First on our list is Oravel Stays, popularly known as OYO.

OYO is a new-age technology platform focussing on short-stay accommodation. It was developed to address the pain points on the supply and demand side by bridging the gap between the two in the hospitality industry.

The company has the largest footprint of over 157,000 hotel storefronts in India and overseas. It offers over 40 products and services to its partners and customers across 35 countries.

So far, OYO has raised around US$4 bn (Rs 324.8 bn) through 19 rounds of funds.

The company filed its draft red herring prospectus (DRHP) in October 2021 and had planned to launch its IPO in 2022.

However, due to volatile market conditions and bearish market sentiment, OYO postponed its IPO, worrying that its valuation might be affected.

According to the prospects, it plans to raise Rs 84.3 bn out of which Rs 70 bn will be from fresh issues and the remaining Rs 14.3 bn through stake sale by existing investors.

The company plans to use the funds for repaying debts and funding its growth plans.

The hotel industry was affected by the pandemic and so was OYO’s business. As a result, in the last three years, the company’s revenue has fallen by an average of 28.7%. However, revenge travel helped the company revive its business, and in the last year, its revenue grew by 20.7% year-on-year (YoY).

The company’s net loss has also been narrowing. In the financial year 2022, it reported a net loss of Rs 19 bn, as against Rs 39 bn the previous year.

OYO is a much anticipated and much-awaited IPO in India and will be one of the biggest IPOs in 2023.

Byjus IPO

2 — Byju’s

Second on our list is the largest startup technology company, Byju’s.

It is an educational platform with 50 million registered students and 3.5 million paid registrations. The company offers its customers personalized learning, technology-assisted learning, and the best teachers and engaging content for personal learning.

Over the past five years, the company has grown through acquisitions and acquisitions of companies such as Epic Educational Services, Osmo, and Aakash. In addition to a diverse product offering, the company also has high retention rates.

Revenue from Byju has grown at a compound annual growth rate (CAGR) of 21.2% over the past three years. In the 2022 fiscal year, it reported a revenue of Rs 100 billion compared to Rs 22.8 billion in the 2021 fiscal year.

The company’s net loss has widened over the past three years, which the company attributed to changes in revenue recognition rules. Byju plans to go public in 2023, but is finalizing plans for a US$1 billion (Rs. 81.39 billion) IPO for its education arm, Aakash Educational Services.

So far, Byju’s has raised $5.5 billion (Rs 447 billion) from investors including Qatar Investment Authority, Tiger Global and BlackRock.

3 — Swiggy

Next on our list is Swiggy.

It is an online food ordering and delivery system. It was founded in 2014 in Bangalore and currently serves more than 500 cities in India.

Apart from food delivery, Swiggy delivers groceries and packages through Swiggy Instamart and Genie. It also launched a loyalty program in 2021 to offer its customers special discounts.

Currently, the company has partnerships with more than 150,000 restaurants and has a strong fleet of more than 260,000 people who deliver food to its employees. It also recently acquired Dineout, a leading restaurant and restaurant technology platform.

Over the past three years, the company’s revenue has grown at a CAGR of 25.4%, with increasing orders. Its losses have been reduced by more than Rs 7 billion in the same period.

Swiggy expects to raise about US$1 billion (Rs 81.31 billion) through its IPO in 2023. It is already preparing for an IPO and has hired JP Morgan and ICICI Securities to manage its portfolio.

The company will pay the customer’s bank to carry out the process in the coming days. So far, the company has raised about US$ 3.6 billion (292.71 billion rupees) in 15 rounds of funding.

Going forward, the company aims to increase its customer base to 100 million and accelerate digital transformation in the food industry.

4 — Go First

Fourth on our list is Go First (formerly Go Air), India’s cheapest airline.

It is part of the Wadia Group, the parent company of the famous Bombay Dyeing and Britannia companies. Founded in 2005, Go First has transported more than 80 million people on trips to 39 destinations, including 10 international destinations.

The company’s fleet includes 57 aircraft and has ordered another 94, which it expects to deliver soon. It is one of the fastest growing airlines, with a market share of 10.8% in 2020.

Over the past three years, its revenue has grown at a CAGR of 16.4%. However, its net loss widened mainly due to the rise in fuel prices. The company filed its DRHP in May 2021 and plans to launch its IPO in early 2022. However, the company is delaying the IPO due to weak consumer sentiment regarding airline stocks. Its DRHP expires in August 2022, forcing the company to file a new IPO application. Go First plans to raise Rs 36 billion through the IPO. The company plans to use the money to pay bills and other projects. Going forward, it wants to launch its IPO in 2023 and grow its market share through its low-cost carrier model.

5 — Mamaearth

Last on our list is natural beauty and personal care company Mamaearth.

Founded in 2016 as a baby care brand, Mamaearth is now a beauty and skincare brand operating in India, Southeast Asia and the Middle East. The company operates as an omnichannel brand and sells its products online and offline.

Its parent company, Honasa Consumer, has acquired and managed many brands in its eight-year history, such as Mamaearth, The Derma Co., Aqualogica, Ayuga, BBlunt & Dr. Sheth’s. Over the past three years, Mamaearth’s revenue has grown at a CAGR of 105%. The company also turned profitable in the financial year 2022 and recorded a profit of Rs 198 million against a loss of Rs 13.3 billion in the previous year. The company has announced plans to raise US$ 300 million (Rs 24.39 billion) through an IPO in 2023 and will soon list its prospects. He plans to use the money to set up offline stores across the country. So far, Mamaearth has raised a total of US$111.6 (Rs 9.07 billion) in funding across eight rounds from investors including Sequoia India, Stellaris Ventures and Fireside Ventures.

The content was collected from various open sources, approved by companies, and does not provide any one-stop recommendation for the purchase of shares. All data was used for only informational purposes and does not contain insider information that may be malicious or refuted by the company and SEC.

This communication does not represent an offer or solicitation to buy or sell securities. Such an offer must be made via definitive legal documentation by the buyer or seller of securities, please check the SEC rules before buying shares from any stock-suppliers.

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Serial entrepreneur, accredited investor, and hedge fund manager. Ex-General Partner of Koch Fund

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Victor Koch

Serial entrepreneur, accredited investor, and hedge fund manager. Ex-General Partner of Koch Fund