Hong Kong’s South China Morning Post (SCMP) reported on the 19th that investors, frightened by Chinese authorities’ crackdown on Internet companies, are turning to India, the world’s second-largest population.
According to data from research firm CB Insight, India succeeded in raising a record $6.3 billion in new technology companies in the second quarter. On the other hand, China’s technology companies raised funds during the same period, down 18 percent from a peak of $27.7 billion in the fourth quarter of last year.
In India, six unicorn companies were born in four days in April. Credit Suisse said in a report that there are about 100 unicorns in India this year with a total market value of $240 billion, from e-commerce and fintech to education, logistics and food delivery.
Unicorn companies refer to unlisted startup companies with a corporate value of more than $1 billion and less than 10 years old.
Food delivery app Zomato became India’s first unicorn company to debut in the stock market, raising $1.3 billion thanks to support from Morgan Stanley, Tiger Global and Fidelity Investment.
The parent company of PATIEM, a digital payment startup, submitted a draft of India’s largest IPO worth $2.2 billion.
Retailer Flipcart Online Services raised $3.6 billion, the largest ever for an Indian startup, reaching $38 billion in corporate value.
“Indian entrepreneurs have been quietly starting their businesses for 10 years, and during that time, Internet infrastructure has improved significantly, and demand for tech stocks around the world is very high,” said Hans Tung, managing partner at GGV Capital.
Unlike Chinese, where Internet use has developed, 625 million India people Internet users are just stepping into the world of video streaming, social networking services and e-commerce.
The opportunity to shop online is particularly attractive. This is because e-commerce accounts for less than 3% of retail transactions. India’s technology startups are still spending a lot of money building supply chains.
India as The World’s Largest Population May Overtake China
India’s population is expected to overtake China for 10 years by the end of the 2020s. At present, the mood among investors is completely different from that in China.
China curbed technology companies by removing market value, which peaked at $800 billion in February, and cutting the net worth of the most famous entrepreneur by billions of dollars.
Chinese regulators last stopped Jack Ma’s Ant Group from launching a blockbuster IPO. A few months later, it suddenly withdrew Didi Chuxing, China’s largest car-sharing company, from the App Store.
The crackdown is expected to continue as regulators rein in the power of Internet companies and take control of user data.