Series A to IPO, to series of returns
Zomato, One 97 Communications (Paytm) and FSN E-Commerce Ventures (Nykaa) — improved their ET500 ranks in FY23, Delhivery slipped lower.
The sharper focus on the post-listing financials of startups has tempered the exuberance while forcing companies to shift focus from gross merchandise value to unit economics and profitability. The funding winter has added to the pressure on new-age companies to tighten belts and reorient their business.
IdeaForge and Honasa Consumer (Mamaearth) listed in the current fiscal year, while others such as PharmEasy, Boat, Snapdeal, and Oyo Hotels have delayed IPO plans.
Besides profit-generating ability, governance is another aspect that is under increasing scrutiny.
Zomato: A strong 55% year-on-year jump in FY23 revenue enabled the food delivery company climb up to 257 in the latest ET500 listing from 320 a year ago.
A key highlight for investors is that the company turned profitable in the first half of the current fiscal year. It will need to control costs to stay ahead of the competition. The Street is hopeful that the company has turned a corner and will continue to grow profitably.
According to Bloomberg data, 86% of the analysts tracking the company are bullish with an average target price of Rs 134.3, 5.5% higher than the current price of Rs 127.35.
Paytm: Paytm moved up in the ranking to 236 from last year’s 309 as its revenue surged 60% in FY23 from a year earlier. Unlike Zomato, Paytm has not yet become profitable. Its recent decision to trim the lending portfolio of small-ticket loans of less than Rs 50,000 following a central bank diktat could have an adverse impact.
