India’s start-ups fire up public markets amid valuation concerns

Indian start-ups are aggressively tapping public markets with high-profile IPOs like Lenskart and Groww, driving a surge in listings despite concerns over lofty valuations, signaling a maturing ecosystem after a funding slowdown. This week, India’s start-up scene witnessed a flurry of initial public offerings, with eyewear firm Lenskart and brokerage app Groww making their stock market debuts. Lenskart’s $821 million offering was sold out in hours, while Groww’s IPO saw overwhelming demand, highlighting robust investor appetite for tech ventures. The IPO rush includes other players like fintech unicorn Pine Labs, set to list later in the week, adding to a diverse range of companies from home services to ed-tech that have recently gone public. This marks a significant shift from the funding winter of recent years, where venture capital exits were challenging, and now provides early investors with lucrative exit opportunities. However, the fundraising frenzy has raised questions about the high valuations of often-unprofitable start-ups. Experts note that while early investors are cashing out with substantial profits, new retail investors face risks if shares are overpriced, as seen in Lenskart’s shaky market debut on Monday. Industry leaders attribute the strong IPO demand to better regulation and a broader investor base, including mom-and-pop investors, mutual funds, and insurers. Shailendra Singh of PeakXV Partners emphasized that market diversity has changed, allowing high-growth companies to find public market acceptance after historically limited appetite. Data from Tracxn shows 43 start-up IPOs this year till November, a five-fold increase from 2020, indicating a maturing ecosystem. Neha Singh of Tracxn points to a decline in start-up failures, with only 724 shutdowns in 2025, down 81% from 2024, as founders prioritize sustainability and disciplined capital use over aggressive expansion. Despite the IPO boom, private funding hasn’t returned to Covid-era highs, with $9.8 billion raised in 2025 compared to $40 billion in 2021. Anand Daniel of Accel notes a shift to thoughtful capital deployment, with stronger fundamentals in companies going public, focusing on profitability and governance. Policy measures like the abolition of angel tax are expected to boost investor confidence, and while the IPO momentum may continue into 2026, market cycles remain unpredictable. In conclusion, India’s start-up IPOs reflect a transition to strategic sustainability, offering exit opportunities for early backers while posing valuation challenges for new market entrants, underscoring the ecosystem’s evolution toward long-term stability.