India PE valuations

Are investors spooked by high Indian consumer company valuations?

Although India remains high on the list of many early to late stage investors’ priorities, there is mounting evidence attention on consumer companies is shifting to business-to-business opportunities.

When Walmart bought the e-commerce firm Flipkart in 2018, many viewed it as a clear sign confidence in the business-to-consumer B2C market in India was high.

The subsequent year witnessed an increase in Chinese investors flying into India searching for cheap B2C companies to place bets. As such, many investors have recently started complaining valuations of Indian B2Cs are getting too rich for their blood, notably for some of the smaller funds with less cash to burn.

Iron Pillar Fund, a late-stage venture capital investor in India with $90 million in assets under management, is one such investor with a preference for business-to-business B2B companies. The fund...

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