Investors need to look at exit options beyond IPOs in India, say limited partners

Limited partners (LPs) urged fellow investors to look beyond IPOs as exit strategies in India amidst buoyant market conditions, even as a slew of prominent startups including Ather Energy, BoAt, Cardekho, Zepto, Bluestone are hoping for their stock market debut in 2025.

Speaking at the IVCA Conclave 2025 in Mumbai, Kunal Sood, Managing Director, Pantheon and Chair, IVCA LP Council said, “We are seeing FII selling. In first 40 days of the year, about $10 billion of capital has left India. And the stock market has corrected. So I think what we need is that while the playbook has worked in an environment that was more benign and congenial, I think you'll need to make tweaks to that playbook as we enter the current environment. For example, last year was very strong on exits and IPO markets were conducive.”

According to Neha Grover, Regional Lead, South Asia Funds group, IFC, while India is a compelling opportunity at the moment, there is still the concern of high valuations and limited opportunities for exits.

“If you look at valuations, they are high. Relative to all other geographies, all other emerging markets, they're definitely high. But having said that, people have still made money. And that is shown in the exits that we've seen over the last few years. So valuations are high, but there is also high growth. Therefore, there is a risk-adjusted return that we can see is generated in India,” she said.