Daijiworld Media Network - Mumbai

Mumbai, Oct 3: India’s capital markets have shown remarkable resilience, defying the global slowdown thanks to strong support from domestic investors, paving the way for several startups to go public. Shailendra Singh, Managing Director at Peak XV Partners, called this “the single biggest” positive development for private market investors, telling TOI that India’s markets are now strong enough to decouple from the US and stand independently.

The blue-chip venture capital firm, which split from its Silicon Valley parent Sequoia Capital in 2023, backs several Indian unicorns, with three — Pine Labs, Meesho, and Groww — set for a Dalal Street debut in the current financial year.

“VCs invest for an 8-10 year horizon. If there is no liquidity after 8-9 years, it creates problems. India has stood out in the last 3-4 years because globally IPO activity has been meagre. Thriving capital markets in India allow high-quality companies to go public, giving investors an exit,” Singh said.

He emphasised that India’s resilient capital markets are supported by domestic institutions, not foreign money, making the market more stable and enduring.

However, Singh cautioned that not all startups should rush to go public.

“If sub-scale companies go public, there could be illiquidity even in public markets later. It’s riskier to be a small public company than a small private one if you’re not in a bull cycle,” he noted.

Currently, six of Peak XV’s portfolio firms in India have filed for IPOs, with more expected to follow, though Singh did not disclose further details.

Following the split from Sequoia, Peak XV aims to become a world-class global firm anchored in India and APAC, while scouting opportunities in software and AI through a team based in the US. In India, the firm will continue to focus on consumer, fintech, software, and AI sectors, with emerging interest in consumer AI.

Singh also highlighted a surge in seed-stage funding for AI startups in India, reflecting a broader trend of innovation and investment in the country’s technology ecosystem.

The robust domestic capital market, he said, completes the investment loop, giving venture capitalists the liquidity and confidence to back India’s next-generation startups.