Top secret: IPO-bound startups may opt for confidential filings to keep options open, sensitive information under wraps
Subscribe to enjoy similar stories. Companies, especially startups, may increasingly be pursuing the path of confidential IPO filings to keep their listing timelines flexible and manage market volatility, people familiar with the public markets said. Edtech company PhysicsWallah, which raised additional capital from existing investor Westbridge, is expected to make a confidential filing for an initial public offering over the next three weeks, a person familiar with the company’s plans said.
PhysicsWallah did not immediately respond to a request for comment on Tuesday. Confidential filings allow companies to keep sensitive information private for a longer duration and submit updated documents only closer to the actual share sale. It also allows them to approach investors with a uniform set of numbers after a regulatory nod and is especially useful for high-growth companies with financials that can change on a monthly or quarterly basis.
The ongoing market volatility is an additional reason for companies to opt for confidential filings, the person cited earlier said. The benchmark BSE Sensex has declined over 13% from a high of 85,978.25 on 27 September on persistent selling by foreign institutional investors. “It allows them the flexibility to time their public offering when the IPO market window opens," an investor said, asking to remain anonymous.
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