Profit-focused startups fuel India’s IPO revival march

India's long-stalled technology initial public offering (IPO) market continued the strong revival march in 2025, as venture-backed companies demonstrated that the path to public markets now runs through profitability rather than growth at any cost.

- PEERZADA ABRAR

Eighteen new-age technology firms went public during the year, a near triple increase from the five firms that debuted in 2023 and 38 per cent more than 2024's tally of 13. Together, they raised ₹41,283 crore ($4.9 billion), with companies including ecommerce platform Meesho, electric-vehicle maker Ather Energy and eyewear retailer Lenskart tapping buoyant investor demand.

The revival march reflects a fundamental strategic shift among founders and their backers following the funding frenzy of 2021-2022.

Firms that once prioritised user acquisition and market share above all else have retooled operations around unit economics, leaner cost structures and clear paths to profitability - attributes that public-market investors increasingly demand.

"Founders are focusing on fixing their unit economics, adopting leaner operations, cutting cash burn, and establishing clear pathways to profitability," said Neha Singh, cofounder of research firm Tracxn. "This operational discipline has prepared them for public markets where investors prioritise stable growth and financial discipline over scale at all costs approach," she added.

Gopal Jain, managing director and chief executive at Gaja Capital, said that after the 2022-23 correction, companies were forced to recalibrate growth, cut discretionary burn, and demonstrate contribution margin discipline. By 2024-25, many scaled startups were either Ebitda-positive or on a clear, time-bound path to profitability.