The Infibeam IPO was supposed to be a watershed moment for Indian e-commerce. It was the first time that an Indian e-commerce company would go public, and leave the sheltered cocoons of private markets behind it. While e-commerce in India has grown quickly, there had been murmurs that it was overheating, and valuations of the top companies were inflated. Under the harsh scrutiny of the bourses, it was expected that Infibeam’s IPO would provide signs as to what the markets really thought of the Indian e-commerce sector.
And the initial signs weren’t encouraging. Infibeam’s IPO got off to a sputtering start after 2 of the bankers involved in the deal backed out. There was further controversy when it emerged that people on twitter were being paid to post positively about the IPO. The reaction from the investment community was muted too – most brokerages listed the new offering as “avoid”.
But Infibeam, in a month since going public, isn’t doing all that badly. Its stock is up 14% since it listed.
And it’s done well in spite of a weak market. The BSE lost 9% of its value over the corresponding period.
Privately listed e-commerce firms, though, haven’t been having a great time of late. Flipkart has seen its valuation being cut by as many as 4 investors in the company, and there are reports that Snapdeal is having trouble raising fresh funds at its valuation of $6.5 billion.
But Infibeam seems to be doing alright. There had been doubts about its decision to go for an IPO, especially considering that it had been profitable for just six months, but its decision seems to have paid off – for now.