Technology stocks in India and the US have beaten, making investors wonder whether the epic Bull Run leads to an unprecedented assessment, a large agreement for unprofitable companies and a party driven by the bottom rates of rock may end.
The newly registered internet companies including Torchbearer Zomato, along with Polikebazaar, Nykaa, Cartrade and Paytm have fallen between 10-30 percent in the last five days, showing data. From their highest listings, they have fallen as much as 50 percent, with billions in the market close evaporating and shifting investor sentiments. Paytm, whose shares have fallen since it is registered, now worth $ 8 billion, the last half a private round of $ 16 billion.
Zomato’s shares fell 30 percent even pushed the founder and CEO to deepen gouces to send records to employees internally to convince them about their financial position, adding that he had been waiting for the bear market. He is certainly not the only one, even when investors poured money into private companies and public technology though alert to their judgment. The internet IPA last year underlies the excitement of retail investors who can invest in new companies whose products consume regularly, which will come 15 years in manufacture.
“I think some rationality on the market is needed. It becomes too hot. Go Public companies now have to provoke their assumptions,” said Punit Shah, partnering in Alteria Capital, Venture debt funds.
Indian technology shares have followed their US counterparts, where company shares such as reshuffle, Lyft and Peloton have fallen sharply. Peloton, whose fitness of bicycles and treadmills are a favorite pandemic, has fallen more than 80 percent.
The fallen shares have led investors to reflect on the real value of these companies, and whether private technology companies are considered too high, given that their aggressive assessment also comes from a blistering stock market.
The company registered in the assessment was significantly higher than the personal assessment (Paytm) only because they saw record requests, and utilizing investor tastes “I think hope is well managed by technology companies in their IPO. Retail investors let their imagination wild when setting Hope, only disrupts the expansion of the assessment. However, these companies continue to remain very hungry for capital and adverse market sentiment will place their capital increasing the big risk, “Shyam Sekhar said, the founder of Ithhought, a financial advisory company.
He said that large institutional investors realized that these companies would always need money, giving them the opportunity to remove shares now and buy them later if they want, even when retail investors buy shares in price.
Because low interest rates in the US and other countries, investors increase their allocation in risky sectors such as technology, targeting better returns than traditional asset classes. Now, as inflation increases, the central bank can raise interest rates again, reduce money available to technology companies, and lead to selloffs.
“With interest rates rising, multiples of assessment must cool. The company with lower cash flow will see their multiples of falling more. Technology companies usually focus growth, so with a little cash flow, they might be beaten,” said Sandeep Jethwani, founder of the management startup Dezerv’s wealth.
“The company for IPOs must recalibrate and compare with other companies globally. Last year there were also many narrative stocks, driven by reddit etc., which will return to normal,” he added.
Investors have not been able to conclude whether the bear market is really setting, or a recent correction is only irregularities.
“This might be just a market that is looking for a reason to improve. This is the market, super fluctuation. It’s still too early to say if this is senior sanity or just liquidation or fire sales. We have to wait a few months,” said Deepep Shenoy, founder of the capital, A advisory company.
Other companies are preparing to go public this year including Delhivery e commerce logistics firms, Hotelier Oyo, and retail brands such as Fabindia and Bikaji, in addition to the Indian insurance life insurance company (LIC), which targets the largest IPO in India by raising up to RS 1 Lakh Crore. If the cold continues, a personal startup assessment can also begin to get hit, with investors recalibrate the actual value.
“We don’t see signs of agreement in India slowing down at this time, but there is usually a pause of 2-3 months until the cold of the public market is felt in the private market,” said Alteria’s Shah.