The Indian stock markets crashed into negative territory on Tuesday going by 2024 general elections trends, erasing all the gains it had made on Monday. This led to a price crash for all the publicly listed Indian startups.
The BSE Sensex crashed by 5.80% and NSE 50 by 6.22% on Tuesday as Parliamentary election results showed that the BJP is unlikely to have a comfortable majority and will have to depend on the allies to form the government for the third time in a row.
The prices of publicly-listed Indian startups also followed the same path after the stock market crash. On Monday, the majority of listed Indian startups saw gains in their share price, but the situation turned completely different on Tuesday.
The stock price of all the Indian startups declined on Tuesday with the steepest fall registered by Honasa Consumer at 6.55% followed by Delhivery at 6.26%. The stock prices of all Indian startups were also in the negative zone. On Monday, majority of the stock prices were up, except in the case of Zomato and Nykaa.
There is now a certain sense of uncertainty on what will be the future direction of the new government and how this is going to impact the Indian startup ecosystem. The present government has been very supportive of Indian startups till now.
The Indian startup ecosystem has had a positive start this year with respect to companies getting listed on the stock exchanges. Go Digit and Awfis were the first two companies to go public this year till now and recorded modest gains in the stock market.
These developments come after a disappointing 2023 for Indian startups as only one leading company–Honasa Consumer–getting listed on the market. This year has proved to be different with many more companies like Ola Electric, Mobikwik, FirstCry, and Unicommerce having plans to list on the stock markets.
The year 2021 saw a flurry of public listings from Indian startups–Zomato, PolicyBazaar, Nykaa, and Paytm. Freshworks was listed on the US stock markets. However, the share price trajectory of these companies were divergent, especially in the case of Paytm, which fell since the day of listing.
Edited by Megha Reddy
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