Reporter in India Bofeng Hu
“Indian technology Internet companies will shake up the country’s stock market”,”Wall Street Journal” A few days ago, a report described the impact of Indian technology companies getting together to go public this year and next. According to the report, Zomato, a local food ordering platform in India, has formally applied for an initial public offering (IPO) to regulators. The Indian version of”Ele.” is expected to raise US$1.1 billion. In addition, the Indian online shopping platform Flipkart, an online payment application PayTm, and online education platform Byju’s, which are owned by Wal-Mart in the United States, are also considering applying for an IPO. Bloomberg revealed that PayTm may launch an IPO later this year, with plans to raise US$3 billion, with a target valuation of as high as US$30 billion. It is expected to become the largest IPO transaction in India’s history.
India’s capital market has grown against the trend
For a long time, energy and financial companies have dominated the Indian stock market, with few high-tech Internet companies. According to data, among the top ten companies in the Indian capital market by market capitalization last year, Reliance and Tata two major industries The group ranks firmly in the top two, Bank, finance Individual stocks account for 50%. The only company that barely dabbles in the technology industry is Infosys, but the main business is still IT outsourcing and business consulting services.
Securities research institutions believe that in the”post-epidemic era,” the digital consumption habits that consumers have developed will continue after the epidemic stabilizes, and companies in the mobile payment field will have great potential. In this context, Indian technology and Internet companies may rush into the capital market from the second half of this year to next year.
The report issued by the Bernstein Research Institute believes that new crown epidemic provides online The Indian companies served have added a large number of new customers, and their customer acquisition costs have also been reduced by 20%to 30%, laying a solid foundation for better financial performance evaluation before the IPO. At the same time, although the new crown epidemic has dealt a heavy blow to India’s economy and society, the country’s capital market has generally shown a momentum of”contrarian growth”. According to the Wall Street Journal, the MSCI India Index has hit a record high since the epidemic, and the cumulative increase this year has reached 14%. The active capital market will help these so-called”unicorns” technology Internet companies to obtain more considerable valuations.
Deep into various industries and life scenarios
According to the daily observation of”Global Times” reporters, the Indian Internet platform that provides online services has achieved unprecedented development during the epidemic. For example, due to the inconvenience of travel caused by the epidemic and the people’s concern about the virus”infecting” cash, the Indian app PayTm, Amazon online payment has replaced traditional payment methods, becoming people’s daily payment of telephone bills, internet bills, electricity bills and other shoppingThe preferred channel for payment.
The reporter saw in the community where he lived, the number and frequency of vehicles on e-commerce distribution platforms such as Bigbasket, Licous, and Swiggy shuttled back and forth every day, far exceeding the level before the epidemic. These platforms have successively launched preferential policies aimed at encouraging online payments, which in turn promoted the further popularization of applications such as PayTm.
Zomato’s”Takeaway Brother” Sharma told reporters on the 12th that an average of at least 30 orders should be delivered every day in southern Delhi,”weekends and Holidays are more than this.” After all kinds of schools in India were closed due to the epidemic, Byju’s also quickly proposed an”online relay teaching” course. During this period, they took advantage of the momentum and became a new force in Internet teaching.
The IPO process will not be smooth sailing
Analysis believes that after a large number of Indian technology and Internet companies go public, they will provide a”window” for foreign capital that previously”bet” to invest in the industry. Ernst & Young recently released a report saying that between 2018 and 2020, various types of Venture investment company and Private equity funds in India’s direct investment is approximately US$93 billion, Among them, the technology Internet, e-commerce and other fields are the most favored by investors.
It is worth noting that weak infrastructure, relatively less transparent business environment and rising nationalism and protectionist sentiments in India may also become a stumbling block for the future development of the country’s technology and Internet companies.”.
Malik, a former official of the Securities and Exchange Commission of India, told the Global Times reporter that although news of Indian technology and Internet companies will be intensively listed recently, they should also be aware that they may Faced with various institutional problems and challenges,”the IPO process may not be as smooth sailing as the news reports.” Malik stated that, according to the regulations of the Securities and Exchange Commission of India, it is almost impossible for to lose money to be listed on the national stock exchange. Or listed on the Bombay Stock Exchange, and most Indian Internet technology companies are in a state of loss due to”burning money”.”This alone is enough to break the listing dream of many companies.”
Indian Securities Exchange In recent years, the committee has been hoping to attract local Internet technology companies to IPO, and has relaxed some regulatory requirements for this purpose, but restrictions such as financial information, tax information disclosure review, and at least three years of shareholding lock-up period still exist. In addition, when India is valuing Internet companies, growth and market size have higher priority than Consideration of cash flow and profit. Except for a few Internet technology companies that are eligible to be listed on the main board, most companies may choose a lower threshold”innovation growth board” for IPO.