Mumbai
Indian drug and medical services startup PharmEasy is in talks with investors to raise $200 million, but at a valuation that could be 15% or even 25% lower than last year’s $5.1 billion, two people with direct knowledge of deal talks told sources.
Signalling growing stress in India’s startup ecosystem, one source said PharmEasy, backed by big-name investors such as Prosus, TPG and Temasek, is in talks to secure the new funds at a valuation as much as 15% below last year’s.
A second source said the company, which offers online medicine deliveries and diagnostic test services, has told its bankers to consider even a 25% reduction if needed to close the deal. That could cut PharmEasy’s valuation for the new funding round to $3.8 billion, and the sources said an initial public offering (IPO) first targeted for 2022 has been delayed.
Indian startups have been jolted by uncertain global and domestic stock markets, and growing investor scepticism over what they say are sky-high valuations, making it difficult for PharmEasy to raise funds at same or a higher valuation, the sources said. They declined to be named as the talks on raising funds were private.
PharmEasy’s planned fund raising is set to see participation from some existing investors, who have indicated they will commit about $115 million in the new round, said the first source involved in the talks.
API Holdings, PharmEasy’s parent company which is looking to raise the funds, declined to comment. API owns other businesses including diagnostic test provider Thyrocare.
