NR Narayana Murthy, co-founder, Infosys
| Photo Credit:
BIJOY GHOSH
The family office of tech billionaire Narayana Murthy is growing cautious on start-ups in India, pointing to steep discounts driven by funds that need to exit their investments.
Middling start-ups struggling with growth that don’t have a clear path to profitability or aren’t making much progress are being sold at discounts of 30-40 per cent, Deepak Padaki, president of Catamaran Ventures LLP said in an interview.
“Funds that invested in these companies want to sell their investments because they are reaching the end of their fund terms,” he said. “There may be opportunities for private equity or secondary funds, but we do not have the bandwidth to take on companies that need extensive hand-holding for a turnaround.”
Catamaran is one of the country’s largest private investors, running $1.3 billion for the Infosys Ltd founder, who is the father-in-law of former UK Prime Minister Rishi Sunak. While India’s start-up scene is one of the world’s largest, valuations have nosedived for several companies that struggled to grow and as investors ask tougher questions.
For example, SoftBank Group Corp.-backed Oyo Hotels was once among India’s most valued start-ups, worth $10 billion in 2019. But stiff competition has hurt its valuation and earnings. It has since bounced back, but has delayed its stock listing several times.
Venture capital and growth deals surged in India during the pandemic to peak at $38.5 billion in 2021, according to Bain & Co. While enthusiasm subsequently fell, deals are still above pre-pandemic levels, recovering slightly in 2024 to hit $13.7 billion. That shows how India’s family offices, venture capital firms and ultra high net-worth individuals continue to write cheques for early-stage companies and their founders.
Urges Caution
Catamaran is among those urging caution. It has invested in only two companies since the start of 2024, arguing that valuations for high growth and profitable start-ups are too high. At the same time, Catamaran says deals for minority stakes without much control are no longer attractive.
It’s now shifting gears to invest in manufacturing, while the majority of its portfolio is in public markets and a handful of tech start-ups. Its holdings include SpaceX and the National Stock Exchange of India Ltd.
Lately, the family office has also begun to focus on companies within specific supply chains like aerospace, electric vehicles, electronics and perhaps medical devices in the future, as India tries to boost local manufacturing and become an export hub. The firm is scouting for small and medium enterprises that have one or two factories but want to scale.
While AI’s influence within the manufacturing sector may not be felt for some time, Padaki said India has a short window to take advantage of the manufacturing interest, especially since it has a cost edge that may disappear as automation becomes the norm.
“As a family office with the potential to deploy more patient capital, manufacturing fits aptly with what we want to do,” he said.
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Published on August 26, 2025
