In the financial year 2025 (FY25), Indian startups raised over ₹44,000 crore (around $5.3 billion) through public markets like IPOs, FPOs, and QIPs. This amount is more than double what they raised from private investors during the same period, according to The Rainmaker Group’s latest report, the RainGauge Index FY25 Annual Update.
This shows a major shift in how startups are getting funds — public markets have now become the main source of capital for late-stage startups.
Key Highlights:
- Private Exits: Around ₹20,000 crore worth of shares were sold by private equity and venture capital firms through block and bulk trades. Big investors like Peak XV and TPG were part of these deals.
- Mutual Fund Interest: Mutual fund investments in these listed startups increased from 10% in March 2024 to 14% in March 2025, showing growing trust from institutional investors.
- Stock Market Performance: The RainGauge Index, which tracks 39 listed startups, grew by 6.3% this year — doing better than major Indian indexes like Nifty 50 and BSE Midcap, and matching the Nasdaq 100’s two-year performance. This happened despite a slow economy, falling GDP growth (6.5%), and heavy foreign investor withdrawals (₹78,000 crore in Q1 FY25).
- Shift in Startup Funding: After the IPO boom of 2021-22, a market correction in 2023, and revaluations in 2024, FY25 is being seen as a “maturity year” for listed startups.
More Discipline, Focus on Fundamentals:
Public markets are now demanding stronger business performance. Valuation standards are being set across sectors:
- Internet platforms: 58x EV/EBITDA
- B2B SaaS: 29x
- Consumer brands: 22x
- BFSI (financial services): 3x price-to-book value
Over half of the tracked startups saw their stock prices fall, mostly due to weak business fundamentals. However, companies like Policybazaar and CarTrade performed very well — with stock prices rising by 93% and 133%, thanks to strong profits.
On the other hand, some consumer-facing brands and fast-delivery startups are still burning too much cash and facing criticism over their business models.
Read more: India Inc Posts 4–6% Revenue Growth in Q1 FY25 Despite Sectoral Weakness
Big Names and Big Moves:
- Zomato became the first startup to enter both the Nifty 50 and Sensex.
- Swiggy joined the Nifty Next 50.
- Other startups like Nykaa, PB Fintech, Ola Electric, FirstCry, Meesho, Groww, Urban Company, Wakefit, and Pine Labs are also moving toward IPOs.
Company Highlights:
- Zomato: 59% revenue growth and ₹527 crore in profit, but margins in its quick commerce segment shrank.
- Swiggy: Losses increased to ₹3,117 crore, despite revenue growing by 117%.
- Policybazaar: Made ₹353 crore in profit and doubled its EBITDA.
- CarTrade: Earned ₹145 crore profit after merging with OLX India’s auto business.
- FirstCry: Saw 43% EBITDA growth despite slower offline sales.
- Travel Boom: MakeMyTrip and EaseMyTrip grew due to rising travel demand — international bookings now make up 25% of their revenue.
What’s Next?
According to The Rainmaker Group (TRMG), public markets are not just a way for startups to exit anymore — they’re shaping how companies grow and scale. TRMG also introduced a new index called RainGauge Private Pulse to track the next set of large private startups preparing to go public.
TRMG’s Managing Partner, Kashyap Chanchani, summed it up:
“We’ve seen everything — IPO hype, market correction, and now a shift to real, fundamental-driven growth. This is the era of maturity. The market wants performance, not just promises.”
Also See: Kotak Mahindra Posts ₹4,472 Cr Q1 Profit; Impacted by Last Year’s Stake Sale
