Kissht, Ola Electric & More: Why Listed Startups Keep Going Back To The Well

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Barely four months after making its stock market debut, digital lending platform Kissht is back in the public markets for more funds. 

Kissht’s parent OnEMI Technology Solutions has received shareholder approval to raise up to ₹832 Cr through a preferential issue of equity shares. The proposed fundraise comes after the company raised around ₹926 Cr through its IPO, including a fresh issue of shares. 

Kissht intends to utilise 75% of the new proceeds to fund its lending arm Si Creva, with the money expected to support its loan-book growth. The rest for general corporate purposes. 

The preferential issue a few months after listing has raised some eyebrows among market observers. But Kissht is not the only one going back to the capital markets after going public.

Over the past couple of years, several tech companies have returned to the equity markets after going public. While most opted for Qualified Institutional Placements (QIPs), others have used preferential issues or rights issues. Thus far, new-age listed companies have not gone for a follow-on public offer or FPO.  

Swiggy raised ₹10,000 Cr through a QIP around a year after its listing. Ather Energy raised ₹1,300 Cr through a QIP roughly 14 months after its IPO, while Ola Electric raised ₹780 Cr less than two years after listing, also through a QIP. 

Zaggle, RateGain, Nazara have also tapped institutional investors through QIPs. Travel tech company ixigo raised around $146 Mn through a preferential issue roughly 16 months after its listing. 

For companies that spent years raising successive private rounds, the public market is now emerging as another source of follow-on capital. Analysts also point to the relatively high OFS component in some new-age IPOs, where existing investors got an exit while the businesses themselves raised a relatively low amount of fresh capital. Even where fresh capital was raised, a lot of it went towards debt servicing. 

Now, the short gap between IPO and another equity raise is raising questions around capital requirements, dilution and how companies are deploying money raised from public investors. Is the need for funding that was a prominent hallmark of........

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