India Eyes Global Lead in Startup IPOs, AI Boom
India is poised to become a global leader in startup initial public offerings (IPOs), according to Rajan Anandan, managing director of Peak XV Partners. Anandan highlighted India’s position as the world’s top IPO market for startups, despite current market fluctuations. He emphasized that while a consistently rising market would be ideal, India’s leadership in startup IPOs is undeniable, though valuations must remain reasonable and profitability is key.
Since 2021, the market has opened significantly for startups, with Peak XV taking 38 companies public. Anandan noted that the firm had eight or nine IPOs in the last 18 months and six in 2025, including five IPOs in five weeks. He added that Peak XV boasts one of its strongest IPO pipelines for the coming years, showing the firm’s confidence in the market’s potential.
AI and deep tech opportunities
Anandan believes India is well-positioned to develop economical AI products tailored to local consumption patterns. He predicts 25-30 AI unicorns by 2030 and sees a $10 billion-plus market cap for AI companies in the next four to five years. This optimism is rooted in India’s ability to create AI solutions that align with the needs of its vast and diverse user base.
India’s AI Mission was praised, but Anandan emphasized the need for government grants and long-term commitments to companies providing computing resources. He also highlighted Chennai’s potential as a deep tech hub and encouraged local entrepreneurs to share their successes publicly. Anandan was in Chennai for the 9th edition of The Better Call Show by Idea Pattarai, a fireside chat with entrepreneurs and investors, where he discussed these insights. After the session, he engaged with portfolio founders of MudhalVC, offering feedback on their pitches.
Challenges and investments
A significant R&D funding gap remains a challenge, with India spending only 0.65% of its GDP on R&D. Anandan noted that India’s annual R&D spend of $18 billion should be closer to $100 billion.
The ₹1 lakh crore RDI Fund is seen as a game changer, aiming to boost private-sector participation. Peak XV’s deep tech strategy includes investments in semiconductors and space tech, with a focus on broadening their portfolio. Anandan highlighted that Peak XV is already invested in four semiconductor companies and several space tech ventures, reflecting their commitment to these sectors.
The IDBI-Fairfax deal drove PE-VC investments to $8 billion in October, with Fairfax’s $5.6 billion stake purchase being a major contributor. This marks the highest monthly tally in over four years, with YTD inflows already surpassing full-year 2025 levels. The deal shows the growing investor confidence in India’s startup ecosystem, particularly in the wake of strategic mega-deals.
