Cloud kitchen operator Curefoods has officially postponed its initial public offering, joining a growing list of Indian tech startups shelving their listing plans amid market volatility. The company, which owns popular brands like EatFit and Krispy Kreme, cited investor resistance to its desired valuation as a key factor in its decision. This move underscores the challenging environment for new-age, loss-making companies seeking to tap public capital markets.
Valuation Pushback Halts IPO Plans
A significant hurdle for Curefoods was the pushback from institutional investors regarding its proposed ₹4,000 crore valuation. During roadshows, mutual funds expressed reservations, finding the valuation steep for a company yet to achieve profitability in the current cautious market. This valuation was established during a pre-IPO placement of ₹160 crore from Binny Bansal’s 3State Ventures, highlighting the gap between private and public market expectations.
A Closer Look at the Proposed Offering
The planned public issue was structured to raise ₹800 crore in primary capital, which would have provided substantial growth funding for the company. Additionally, the IPO included an offer for sale (OFS) of up to 4.85 crore equity shares by early backers such as Accel, Chiratae Ventures, and Iron Pillar. This structure aimed to provide both fresh capital for the business and a partial exit for its initial investors.
Strategic Use of IPO Proceeds
Curefoods had outlined a clear expansion strategy to be funded by the IPO proceeds. The company intended to use ₹152 crore to expand its physical footprint by adding over 66 new cloud kitchens, restaurants, and kiosks for its existing brands. A further ₹127 crore was allocated for the repayment of certain debts, a move aimed at strengthening its balance sheet ahead of further growth.
A Reflection of a Wider Market Trend
The decision to delay the IPO aligns with a broader trend of caution in the Indian technology sector, with major players like PhonePe and Flipkart also deferring their listings. This widespread hesitation stems from increased investor scrutiny of profitability metrics and sustainable growth paths for internet-based companies. The general slowdown in the food delivery industry has also contributed to a more conservative outlook from potential public market investors.
Financial Health and Future Strategy
Despite its profitability challenges, Curefoods has shown strong top-line growth, with its operating revenue increasing by 27% to reach nearly ₹746 crore in fiscal year 2025. The company also managed to slightly narrow its net loss to ₹170 crore from ₹172 crore in the previous year. Looking ahead, Curefoods is pivoting its strategy to focus on premium brands targeting Gen Z consumers and developing a hybrid 60% online, 40% offline business model.
In conclusion, Curefoods' decision to postpone its IPO reflects a pragmatic response to unfavorable market dynamics and valuation pressures. The company plans to re-evaluate a public listing next year, provided that market conditions become more conducive for growth-stage technology firms. In the interim, Curefoods will concentrate on enhancing its operational efficiency, expanding its brand portfolio, and building a more resilient, multi-channel business.