BoAt Becomes The Latest Indian Startup To Withdraw Its IPO Plans

With listed startups being battered at the stock markets, the ones that were planning to go public seem to be developing cold feet.

Wearables company BoAt has become the latest Indian startup to withdraw its IPO plans. BoAt has formally withdrawn its DRHP, which it had filed in January this year. BoAT had received a go-ahead from SEBI for the IPO in May. But the company now has withdrawn its IPO application.

“According to [SEBI] guidelines, boAt was allowed to raise Rs 180 crore before the IPO, but we have raised more than Rs 500 crore of equity, so it has proactively withdrawn the DRHP,” a company spokesperson told Business Today. He added that boAt could reconsider its IPO plans in the next 12-18 months depending on the macroeconomic situation. 

BoaAT also announced that instead of going public, it had raised $60 million (Rs. 500 crore) from private investors in a new funding round. Existing investor Warburg Pincus and new investor Malabar Investments participated in the round. The round reportedly valued BoAt at $1.4 billion. The company said it planned to use the funds to expand its smartwatch category and scale up business across channels and markets in India and abroad.

BoAt isn’t the only startup that has shelved its IPO plans in recent times. Mobikwik had filed for a Rs. 1,900 crore IPO in July 2021, but announced it was delaying its plans in November the same year. In November 2021, PharmrEasy had filed for a Rs. 6,250 crore IPO, but had withrawn it in August this year. In November last year, Droom too had filed for a Rs. 3000 crore IPO, but had withdrawn its application earlier this month. Oyo Rooms too had filed for an IPO, but has now delayed its plans.

It’s for good reason that startups are being squeamish about going public — as of last week, all listed Indian startup stocks were trading below their IPO prices. CarTrade is down 64% from its IPO price, while Zomato is down 15%. Delhivery is down 20%, Policybazaar is down 60%, while Paytm has fared the worst, and currently trades at 70% below the price it had gone public. Nyakaa has been the latest startup which has seen its stock price fall, and now trades 10% below its IPO price. Global tech companies haven’t fared any better — companies like Google and Microsoft have fallen 30% this year, while Meta has collapsed 70% in the last 12 months. With startup stocks being battered across the globe, it could be a while before Indian startups are again willing to stomach the trials and tribulations — and scrutiny — of the public markets.