India has only 17 profitable unicorn start-ups, according to market research platform, Tracxn. The country houses 114 unicorns of which 80 startups' data is publicly available. A unicorn is a company valued at $1 billion or above.
The top profitable companies include stock brokerage platform Zerodha, Software as a Service (SaaS) platform Zoho, e-commerce platform Firstcry, fintech firm Billdesk, and a few others.
They have made profits worth Rs 2,094 crore (FY22), Rs 2,747 crore (FY22), Rs 215.4 crore (FY21), Rs 245.6 crore (FY21) respectively. The data has been extracted from financial statements of FY21 and FY22.Other profitable start-ups in the list are Molbio Diagnostics, Uniphore, Xpressbees, Physicswallah, IPO-bound Mamaearth, CoinDCX, and more.
There are a couple of special cases as well.
For instance, fintech company PhonePe was acquired by Flipkart in 2016 but it separated its ownership from the Walmart-owned brand officially this year and therefore its status remains uncertain. PhonePe also shifted its domicile from Singapore to India.
Data by Tracxn also revealed that in the last two years, around 16 start-ups have moved away from their unicorn status. These start-ups are no longer unicorns because they have either been acquired or been listed on stock exchanges.
Start-ups such as Tata1mg, Blinkit, Rivigo, BigBasket, Flipkart, ShopClues saw their unicorn status changing because they were acquired.
BigBasket and Tata1mg were acquired by Tata Digital. However, one of the most prominent deals happened between ecommerce giant Flipkart and retail giant Walmart. Walmart acquired 77 per cent in the ecommerce giant in 2018 and picked up 100 per cent stake in the Binny and Sachin Bansal-founded company in 2020 for a whopping $1.2 billion. Flipkart's valuation has soared over the years to reach around $37.5 billion today.
The last two years also saw companies making their debut on the stock markets. The list includes Paytm, Zomato, Nykaa, Delhivery, PolicyBazaar and Five Star Business Finance.
In addition, these companies saw their valuations dip post their listing.
A list by Hurun revealed that PolicyBazaar, Paytm, Zomato, and Nykaa lost Rs 2 lakh crore cumulatively as they lost 68 per cent, 59 per cent, 50 per cent and 48 per cent, respectively in value since their listing.
Public listing and acquisitions apart, some of the start-ups were downgraded from the unicorn status owing to their valuations being cut down. These include Quikr and Paytm Mall. Paytm Mall’s valuation dipped from $3 billion to $13 million after its lead investors Ant Financial and Alibaba offloaded their shares in September last year. A similar picture shaped out for Quikr when its Swedish investor Kinnevik devalued the online classifieds marketplace by 45 per cent after its revenue was found to be exaggerated and incidents of fraudulent transactions surfaced within the country.
India has the third largest start-up ecosystem in India after the US and China. According to estimates shared by the government, there are over 92,000 registered start-ups in India.
While they may be experiencing a funding crunch, with investments sliding as much as 50 per cent especially in the case of late-stage start-ups, it is important to note that 2021 was a momentous year for this ecosystem. Start-ups racked up a whopping $42 billion from global investors including giants like SoftBank, Accel, Tiger Global, and others.
The scenario in the current year is far from what it was then.
The funding in start-ups continues to dip even till February 2023 as global VCs sit on dry powder worth $590 billion available for investment.
Note: Tracxn classifies all tech companies as start-ups and has collated unicorns as per valuation
