**India’s Capital Markets Show Remarkable Resilience, Fueling Startup IPO Surge**
India’s capital markets are demonstrating remarkable resilience, driven by robust domestic investor support. This supportive environment is enabling a surge of startups to go public, providing crucial liquidity for venture capitalists like Peak XV Partners to exit their investments.
**Domestic Investors Driving Market Strength**
“India’s capital markets have been resilient, defying the global slowdown thanks to strong backing from domestic investors,” said Shailendra Singh, Managing Director at Peak XV Partners. “This has been the single biggest positive development for private market investors.”
For the first time, Indian capital markets are strong enough to decouple from the US markets and stand on their own, Singh told *The Times of India* in an interview. This marks a significant milestone for the country’s financial ecosystem.
**Peak XV Partners’ Growing Influence Post-Sequoia Split**
Peak XV Partners, a blue-chip venture capital firm that split from its Silicon Valley parent Sequoia Capital in 2023 as part of a global restructuring, has backed several Indian unicorns. Notably, three of their portfolio companies—Pine Labs, Meesho, and Groww—are set for a Dalal Street debut in the current financial year.
**Contrast with IPO Slowdown in the US**
While IPO activity has slowed considerably in the US over the past three years, India’s capital markets have thrived. According to Singh, “VCs typically invest with an 8-10 year horizon. If you invest for 8-9 years but there is no liquidity, it creates a major problem.” The thriving IPO market in India provides much-needed liquidity, completing the loop for investors by giving them an exit option.
Singh notes that the continued strength of India’s capital markets is not just a short-term occurrence. “It feels like capital market liquidity here is enduring, not just a transient blip, because there are significant domestic institutions actively participating. Having a domestic source of strength rather than relying on foreign money makes the market more resilient.”
**Caution Advised for Startups Considering Public Listings**
While the favorable market conditions may encourage more startups to go public, Singh advises caution. “Not every company should be public, and founders need to be careful. If too many sub-scale companies list, it may lead to illiquidity even in public markets.” He explains that being a small public company outside of a bull market cycle can be much riskier than remaining private.
Currently, six of Peak XV’s portfolio firms in India have filed for IPOs, with more expected to tap public markets soon, Singh revealed, without disclosing specific details.
**Peak XV’s Expanding Global Vision**
Following the split with Sequoia, Peak XV’s core values remain consistent, though there has been some shift in investment strategy. The partners aim to build Peak XV into a world-class global firm anchored in India and the Asia-Pacific region.
To support this ambition, the firm has established a team in the US to help expand its presence and scout opportunities in software and artificial intelligence (AI), sectors Singh describes as being in a “super cycle” globally.
In India, Peak XV will continue to focus on consumer, fintech, software, and AI sectors. While the firm is not chasing the quick-commerce trend out of fear of missing out (FOMO), it sees other promising opportunities in the consumer space—particularly consumer AI, which Singh believes could grow significantly in India in the coming years.
“There has been a big pickup in seed-stage funding for AI firms in India, and a lot of startups are emerging in the AI application space,” he added.
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https://timesofindia.indiatimes.com/business/india-business/resilient-dalal-street-a-boon-for-private-investors/articleshow/124280505.cms
