Indian cloud companies to drive next wave of tech listings

Indian capital markets are poised for a wave of listings by cloud-based software providers, with bankers and investors predicting that at least seven to eight such startups are set to go public locally over the next 12-18 months.

- Mansi Verma [e-mail]

SaaS firms are expected to drive tech IPOs. ISTOCKPHOTO

Unlike consumer-facing firms that have dominated the listed pipeline so far, software-as-a-service (SaaS) companies are expected to drive tech initial public offerings (IPOs) next. RateGain and, recently, Capillary Technologies are the only such large listings in India.

Now, their peers, including Amagi, Leadsquared, BusinessNext, Zenoti, Icertis, Mindtickle, Juspay and Whatfix, are either preparing for IPOs or considering public listings, bankers and investors said.

“Over the last few quarters, we have been seeing a clear build up in the SaaS IPO pipeline in India, particularly amongst profitably growing companies that scaled during the 2020-22 period and are now approaching predictable ARR (annual recurring revenue) and operating profitability thresholds,” said Pankaj Naik, managing director and co-head, digital, tech and consumer investment banking, Avendus Capital. “The number of IPO-ready SaaS companies today is materially higher than in 2021-22, when only a handful qualified.”