SMBC Pledges $200 Million for Indian Startups Amid IPO Boom

As per Bloomberg, a fund managed by the banking arm of Japan’s Sumitomo Mitsui Financial Group (SMFG) plans to invest a major share of its $200 million fund in Indian startups. The decision comes at a time when India’s IPO market has seen strong activity, creating options for investors to exit through public listings.

Investment Details

The SMBC Asia Rising Fund, co-managed with Japan’s Incubate Fund, has been active for about 2 years. So far, it has invested around $100 million in nearly 12 startups across India and Southeast Asia, including Vayana Pvt, Modifi, and M2P Solutions Pvt. The remaining capital is expected to be deployed by the second half of 2026.

Allocation and Structure

The fund plans to direct around 75% of its total corpus towards Indian companies. The remaining 25% will be invested in startups based in Singapore, Indonesia, and Vietnam. The fund typically holds investments for 5 to 6 years and seeks returns in the double-digit range.

Rise in IPO Activity

Initial Public Offerings (IPOs) in India have crossed $16 billion so far in 2025, supported by strong demand from small investors, insurance companies, and domestic mutual funds. The rise in listings has created exit opportunities for venture capital and private equity funds. 

This trend is drawing more foreign investors to India’s startup ecosystem, which has seen growth in both funding and valuations.

Operations in India

SMFG has been increasing its exposure to India in recent years. In a major deal, the group acquired a 20% stake in Yes Bank Ltd. for about $1.58 billion. The latest investment plan builds on its broader strategy to expand its financial partnerships and lending presence in the country.

Read More: Indian Startup Funding Drops 38% to $2.1 Billion in Q3 2025!

Conclusion

The new $200 million fund shows SMBC’s growing activity in Asian markets, with India receiving the largest share. The investments are expected to be completed by 2026 as the firm continues identifying startups with potential access to public markets.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.