A Comparative Study of Financial Performance and Valuation Metrics of Indian Tech-Startups: An Analysis of the Pre-IPO and Post-IPO Era (2020–2025)
Year: 2026
Type: article
Abstract: The Indian startup ecosystem witnessed a paradigm shift during 2021–2023 with the public listing of several venture-backed technology unicorns. While private markets historically prioritized growth and valuation expansion, public markets impose discipline through transparency, governance, and profitability expectations. This paper examines whether the transition from private to public ownership has improved the financial performance of Indian New-Age Technology Companies (NATCs). The study addresses three objectives: (i) to compare profitability in pre-IPO and post-IPO periods; (ii) to test whether public listing significantly affects financial performance; and (iii) to identify sectoral variations in post-IPO outcomes. Using secondary data from Red Herring Prospectuses and Annual Reports for ten Indian tech startups during FY2018–FY2025, the study applies a paired t-test on Net Profit Margins (NPM). Results reveal a statistically significant improvement in post-IPO profitability (p < 0.05), indicating that public market discipline encourages a shift from “growth-at-all-costs” to sustainable business models. The study contributes to IPO literature in emerging markets and offers insights for investors, regulators, and policymakers.
Authors: Prajwal Shekhar, MP Gowtham, B Shekhar
Institution: Tumkur University
Language: English
Subfield: Finance
Domain: Social Sciences
Open Access status: bronze
OpenAlex ID: W7125517907