The year 2025 offered India’s listed tech startups a chance to change their narrative of growth-at-all-costs to sustainable growth and prove their resilience.
After the euphoric IPO rush of 2021-24, the public market got used to the way tech-first startups function and the new business metrics that defined these digital-first firms better such as adjusted EBITDA margin, NOV and contribution margin.
What unfolded there on was a tale of two cohorts.
On one hand, the shares of Ola Electric, Swiggy, FirstCry, Honasa, and many such in-the-red companies bled, wiping out tens of thousands of crores from their market capitalisations.
And on the other, companies like Eternal, Nykaa, Paytm and Ixigo either flipped to profitability or delivered such sharp swings in unit economics that investors rewarded them with multiple expansion and share-price gains of 30-100% even as the year saw scarce movement in the broader market.
As market volatility, cautious sentiment, and tighter institutional scrutiny set in, the market began clearly separating companies with discipline from those chasing growth without clarity on profitability timelines.
As the year comes to its sundown, Inc42 tried to take a look at the way some listed tech startups had their coffers scorched, while others weathered the heat of Dalal Street and revived.
Although their IPOs scripted success stories, several listed firms entered 2025 while struggling with losses fuelled by cash burns from steeper customer acquisition costs (CAC), higher investments in dark store expansion, more subsidies to drive repeat usage, and better logistics infrastructure to reduce reliance on third-party partners.
Some of these decisions worked in favour, but the rest attracted sell-offs because of growth without any visible profitability timeline as well as market corrections.
For numerous firms, the topline growth slowed down in the face of elevated cost pressure.
Sunny Agarwal, who heads fundamental equity research at SBI Securities, said that the concerns and challenges for each of these new-age companies were unique to their respective verticals and industries. Rapid expansion and increasing competition, however, kept building pressure on their margins across 2025.
Public market investors responded predictably with rating downgrades, valuation reductions and steep price corrections.
Ola Electric, which listed in August 2024 at a peak valuation of over INR 35,000 Cr, ended 2025 with its market cap down to INR 17,000 Cr, a 50% erosion from its January 2025 high of INR 148 per share. The company’s net loss for FY25 widened more than 40% to INR 2,276 Cr, while its revenue slumped 9% to INR 4,645 Cr.
The core problem was simple – aggressive capex on gigafactories and a pivot to mass-market scooters failed to deliver the promised volumes. Subsidy cuts, charging-infrastructure delays, and a miss on its own Q2 FY26 guidance triggered a vicious cycle of downgrades and selling.
Swiggy, however, has a different tale to tell. The company’s revenue grew 35% to INR 15,227 Cr in FY25 and 54% in the first half of FY26, while consolidated losses ballooned 33% to INR 3,117 Cr for the full year and H1 FY26 adjusted EBITDA loss widened 109%.
The intense competition from Blinkit and Zepto on the quick commerce turf, primarily dark store expansion and customer acquisition costs, kept Swiggy’s margins under pressure, leading to overall widening of losses even as the company’s core food delivery business reported a stable topline growth.
From a 2025 high of INR 617, the stock slid to INR 402 by December, declining more than 30% frrom the yearly highs during the year, with a market cap erosion of more than INR 20,000 Cr.Overall the consumer internet firm saw a 6% stock price decline in 2025.
FirstCry and Honasa (Mamaearth) followed the same script on a smaller scale. Inventory overhang, regulatory scrutiny, and marketing spends refused to taper and shaved off nearly 40% in share price. MamaEarth’s swing to profitability in Q2 FY26 finally led to some recovery in stock prices towards the end of the year, though traded down 20% from the 2024 highs.
While the companies found themselves struggling to regain profitability, the patterns that emerged among many of these firms included expansion into capital-intensive verticals, subsidy dependence or discount-led models, competitive heat and pivots that impacted investor confidence.
Private markets may withstand experimentation at scale. But, public markets stand experimentation only till the core remains profitable or reliably cash-generating.
“The market punishes three things mercilessly: missing your own guidance, losing market share, and frequent narrative pivots. Ola Electric did all three in 2025. Swiggy did the first two, but at least provided forward-looking profitability milestones, which is why the punishment was severe, but not terminal,” Agarwal pointed out in an exclusive conversation.
His broader observation was crucial.
“A company that is still making losses but consistently gaining share in a $50–100 Bn addressable market will be given far more rope than a legacy firm bleeding cash in a mature market,” he added.
The massive user cohorts these platforms command act as a structural advantage that legacy companies simply do not have.
That is why investors remained optimistic about Swiggy despite its INR 3,000 Cr-plus annual losses. The guidance was clear in Swiggy’s Q2 FY26 note to shareholders: Contribution positivity in quick commerce by Q4 FY26, adjusted EBITDA breakeven by FY27, and a war chest of INR 18,000 Cr to fight the quick commerce war.
The moment a company starts missing its own milestones or executes messy pivots, the market loses trust, according to the analysts.
“The main issue is their aggressive growth targets to get higher valuation numbers with spiralling cost overheads. The customer acquisition cost in many of these companies is still 3-5 times the lifetime value in the early cohorts. The moment they try to reduce promotions and offers to move towards sustainable profits, order frequency drops 20–30%. The question the market is now asking is brutal, but fair: Can they sharply reduce CAC and move towards sustainable profits before the market runs out of patience, or can they do so without promotions and offers?” wondered Sahen Karamchandani, who founded WealthInIndia.com.
Losses are not the problem, according to Agarwal, but the clarity in execution is. “If companies are missing their own guidance, losing market share, or pivoting without strategic clarity – as was seen in pockets of Ola Electric – markets will punish them. Public markets reward discipline, and not chaos.”
Eternal, which controls Zomato and Blinkit, surprised the market with profitability at a consolidated level. It closed FY25 with a maiden full-year profit of INR 527 Cr, while H1 FY26 saw its revenue explode 126% on-year to INR 20,757 crore, driven by Blinkit’s contribution turning positive and food delivery margins expanding to 5% of the GOV.
A full-year profit alongside strong revenue growth reassured that the core business remains fundamentally robust — the company isn’t bleeding cash indefinitely. From entering the 2025 with a share price of INR 220, the stock ended the year around INR 320, clocking a 35% gain that added roughly INR 1,50,000 Cr to its market cap in a flat market.
Nykaa, after two years of pain, staged an equally impressive turnaround. With increased contribution of private label sales, marketing costs went down 22% on-year and Q2 FY26 delivered a tripling of net profit with 25% growth in revenue. The stock gained more than 70% in 2025, recovering most of its 2024 losses.
Paytm, written off by many after the RBI embargo, surprised the Street with a swing to profitability in the first two quarters of FY26, when the majority of its fintech peers grappled with losses. The sharp rebound was driven by better financials: profits returning after prior losses and improved cost discipline – factors that helped revive investor confidence. The share price of Paytm climbed roughly 50% from the beginning 2025, adding INR 40,000 Cr to the market cap and delivering 90% returns to its investors.
Ixigo, the dark horse of the travel-tech space, saw its bottomline surge 128% in FY25 on the back of a railway-booking surge, with the stock rallying more than 100% over its listing price in 2024.
Agarwal of SBI Securities said these turnaround examples and consequent share price gains put up classic examples of how public market sentiments have adapted with the listing rush of new-age companies since 2021.
There are no free-lunches in public markets, though. Unlike private capital, it is highly unlikely that retail investors will have a similar risk appetite like VCs.
This is where public markets differ sharply from venture capital. A three to four-year horizon may be par for the course in the VC world, but a big chunk of the public market investors – both foreign institutional investors and retail investors — would look at short term gains. It’s only domestic institutional investors that typically hold stock for the long term.
Agarwal also cautioned that the era of blind growth funding is over. “Retail investors now own 12-18% of most new-age stocks. They are far more discerning than many founders realise. They will forgive losses if the story is intact, but they will not forgive surprises.”
This was highlighted in 2025 by super gainers like Eternal, Paytm, Ather, Nykaa — consistent market share gains (or at least no loss), meeting revenue or EBITDA guidances, improving contribution margins quarter-on-quarter and a transparent path to profitability if some of them aren’t profitable yet.
This year marks a shift in how India evaluates its new-age public companies. Agarwal said that the forward-looking statements or revenue guidance have long served as a hope story for the investors but the larger question remains: Is narrative enough? Or should numbers follow?
Inc42 spoke to multiple founders of the companies that went listed in 2025 such as Groww, PhysicsWallah and Meesho. They all reiterated that for any tech-enabled business, the user base is an asset and that experimentation or pivot will always be a core to their business model, though as public listed companies, they have to exercise a stricter financial discipline.
For companies like Eternal and Nykaa, this recalibration validated their frameworks. For others like Paytm, it accelerated a hard reset on capital allocation, pricing strategy, category exits, and roadmap realism.
There are of course cues that Indian markets can take from the likes of the US and China where platform-based companies have been listed for a longer period and have shown resilience with changing global consumption trends.
Indian consumer tech firms do have a massive user base leverage and have attracted domestic institutional investors from mutual funds to insurance companies to thematic tech-focussed AIFs to invest in them.
The bottomline for 2025, as Inc42 research revealed, was a reality check for India’s new‑age IPO startups. The year rewarded operational rigor and punished unrealistic economics. After the reality checks and setbacks, the coming year will be all about converting rapid growth into durable cash-generating models – a transition that will determine which firms will sustain and emerge as long‑term market leaders and which will disappear in dust.
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