On Monday, Shares of PolicyBazaar, Nykaa, Zomato and Paytm — 4 Indian tech start-ups which went public last year — fell to their lowest levels since their debuts in the market last year, as analysts forecast a global market correction amidst concerns among US investors about the possibility of high-interest rates.
On Monday, Paytm shares fell more than 6% to as low as $880 ($11.8), the lowest since the company went public in mid-November. The mobile payments firm’s market worth has plummeted to $7.7 billion, which is less than half of the $16 billion valuations at which it received $1 billion in a private fundraising round in the last half of 2019.
Zomato’s shares fell the most, by more than 18.5%, of the four aforementioned IT businesses. Nykaa shares fell more than 13% to $1,693 ($22.6) a share, down from an all-time high of $2,574 ($34.5). The shares fell to as low as 91.7 ($1.23) a share after reaching an all-time high of 169.10 ($2.27). PolicyBazaar plummeted more than 9% to 766 ($10.2) per share, roughly half of its all-time high of 1,470.
The current drop — which hasn’t had as much of an influence on other Indian equities — comes as shares of tech firms that have risen in previous years as a result of the epidemic begin to face what many analysts are calling a “correction.”
The rally has also aided firms around the world in raising finance at record-high valuation increases and rates.
However, numerous investors are now publicly warning entrepreneurs that those days are coming to an end – at least for the time being.
In a tweet this week, Shailendra Singh, a venture capitalist at Sequoia Capital India, expressed that Market sentiment changes quicker than entrepreneurs can adjust operations, monetization levers, or cost structures.
Last week, Rajeev Misra, CEO of SoftBank Vision Fund, stated at an Axios conference that SaaS stocks in the United States have dropped from 20 times their revenue to 12 times.