Indian market still small to absorb large internet cos: InMobi, Flipkart

Sachin Bansal of Flipkart
India's top e-commerce firm Flipkart  and largest advertising technology firm InMobi say they would like to raise funds in a local public offer, but find that the market is still small to handle the large fund raising required from the country's internet firms.

"There is a huge dichotomy, The way things stand currently, it is close to impossible to list in India. The dichotomy is because of the fact, we belong to India, built the company in India and serve Indian market. The  emotional component is to list in India. But the markets are not ready," Naveen Tewari, co-founder of InMobi, India's largest valued ad technology firm told Union Minister of State for Finance Jayant Sinha at a start-up event on Saturday.  "I don't think Indian markets are ready. It cannot absorb the number  of internet companies that want to list in the next five years. Foreign money coming in India is the right thing."

Sachin Bansal, co-founder of Flipkart, India's largest e-commerce firm that is valued at $15 billion, said India should be a top choice for the company as local investors understand the context of the business, but was doubtful whether the stock market could absorb such a large listing.

"If we are able to attract $5-10 billion foreign capital with foreign listing," said Bansal.

India's largest internet listed company is InfoEdge that has a market capitalisation of around $2-3 billion, said Minister Sinha.

Shopclues co-founder Radhika Aggarwal said that India would be the obvious choice for listing because people understand the business dynamics of the company provided the policy allows it to list.

Sinha played the patriotic card saying that if India government liberalises policies to raise funds in India, Naveen Tewari should look at listing in the country.

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