Several high-profile companies like Zomato, Nykaa, and Paytm proved to be poor investment choices in the long run. They tanked on the bourses, sinking investors money with them. This phenomenon led to regulators tightening the whip on IPO rules in the country. However, several other large corporations that were eager to join India’s IPO bonanza have delayed their IPO dates considerably.
Let’s take a closer look at this story!
Delay in IPO listing by Delhivery and OYO
Logistics provider Delhivery and hotel chain OYO have pushed back their IPO dates because of the poor market sentiment related to IPOs or initial public offerings. However, at the beginning of 2021, several significant start-ups in the country went the IPO route and listed their companies on the bourses.
Unfortunately, these companies did not do well on the bourse. Fintech firms Paytm and e-commerce companies like Nykaa and Zomato also tanked.
This led to market regulator SEBI cracking the whip after a number of investors got burned by the poor show. Investors, now, have become widely cautious, with a number of strict rules and regulations being enforced for their benefit.
Delhivery and OYO Hotels have pushed back their IPO dates, given the present scenario. Moreover, they have prepared to reevaluate their target valuations. The companies are prepared to reappraise their target evaluations.
Apart from Delhivery and OYO Hotels, PharmEasy, Droom Technology Ltd., Druva Inc., InMobi Pte., and Pine Labs Pvt. have all pushed back their IPOs. Companies are now wary of the IPO scenario. Representatives for these companies refused to comment or divulge any further details. Hence, given the tightening of regulations by SEBI (Securities and Exchange Board of India), there is wariness and caution in the market. It will take some time before investor sentiment again rises.
Frequently Asked Questions
How much did Paytm’s parent company raise in the IPO?
Paytm’s parent company, One97 Communications Ltd., raised $2.5 billion in their IPO. The company went public in November, and the amount it raised happens to be a record value.
How much did Paytm’s parent company lose post the IPO?
Post the IPO, stocks of Paytm fell 60%, which greatly shocked investors and regulators. Moreover, there was a large exit of foreign investors.
Who are the investors of OYO hotels?
The investors of OYO hotels are Sequoia Capital, SoftBank, Lightspeed Venture Partners.
Disclaimer: This blog is exclusively for educational purposes and does not provide any advice/tips on investment or recommend buying and selling any stock.