From Anthropic’s delayed IPO plans to the much-anticipated SpaceX listing and its subsequent correction, the debate around technology valuations is becoming increasingly relevant for investors.
The excitement around AI and high-profile IPOs is undeniable—but the bigger question is whether valuations are being driven by current business economics or expectations of what these companies could become five or ten years from now.
Mehul Vora, Chief Technology Officer at Mirae Asset Sharekhan, believes investors need to look beyond the headline story and examine the underlying architecture of the business.
For AI companies, that means asking whether there is a sustainable technology moat, who owns the customer relationship, how quickly revenues are scaling relative to compute costs, whether margins improve with scale and how difficult the product is for competitors to replicate.
Vora also draws a distinction between IPO excitement and intrinsic value. The initial surge around a highly anticipated listing can reflect pent-up demand, scarcity and sentiment, but the market eventually returns to fundamentals.
His key question for investors is not how much a stock could rise on listing day, but what assumptions about future growth are already embedded in the valuation. For Indian investors, the opportunity comes with another layer of complexity.
Accessing US IPOs or pre-IPO shares involves eligibility, overseas investment rules, KYC, tax and reporting requirements, while pre-IPO investing also carries significant liquidity and information risks.
So, from Anthropic’s IPO ambitions to SpaceX’s valuation journey, the central question is becoming harder to ignore: are investors buying a genuine technology moat—or simply paying for the AI narrative?
In this edition of ETMarkets Smart Talk, Mehul Vora breaks down AI valuations, IPO hype, pre-IPO risks and the framework investors can use to separate technology potential from economic potential. Edited Excerpts -
Q) Anthropic has reportedly pushed back its IPO plans. Red flag or normal listing process?
A) I wouldn’t automatically treat a delayed IPO as a red flag. For a technology company, particularly an AI company, the decision to go public is as much about strategic timing as it is about valuation.
An IPO should happen when the company is ready to operate under public-market scrutiny—financial reporting, governance, predictable metrics and investor expectations.
If management believes private capital gives it more flexibility to invest aggressively in compute, talent, and product development, postponing a listing can be rational.
From a technology leadership perspective, I would look beyond the IPO date and ask: Is the underlying technology creating sustainable competitive advantage, are revenues scaling, and is the cost of serving each incremental customer becoming more efficient?
Q) Are investors valuing AI companies on today’s earnings or what they could become 5–10 years from now?
A) For many AI companies, the valuation is clearly incorporating future expectations. Markets don’t value a technology company purely on today’s earnings. They attempt to discount the future cash flows and competitive position of the business.
The challenge with AI is that the range of possible outcomes is enormous. A company could become a foundational technology platform—or discover that its technology becomes commoditised very quickly.
As a CTO, I would therefore separate technology potential from economic potential.
The questions I would ask are:
What is the sustainable moat?
Who owns the customer relationship?
What is the cost of inference/compute?
Are margins improving as scale increases?
Is the AI product becoming mission-critical?
How difficult is it for competitors to replicate?
The bigger the gap between today’s economics and the valuation implied by the future, the more execution risk the investor is taking.
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Q) How do you distinguish genuine long-term AI winners from companies benefiting mainly from the AI narrative?
A) This is probably the most important question.
AI branding is not an AI moat. I would evaluate an AI company through five lenses:
Does the company possess something difficult to replicate?
Can it acquire millions of users or enterprise customers efficiently?
Does revenue grow faster than compute and infrastructure costs?
Is AI deeply integrated into the customer’s workflow, or is it simply another feature?
Does the company become part of a broader developer, cloud, data, or application ecosystem?
Ultimately, I look for the combination of technology moat + distribution moat + economic moat.
A company saying “we use AI” is very different from a company where AI fundamentally changes the economics of the business.
Q) What does the SpaceX IPO move and subsequent correction tell us about highly anticipated IPOs?
A) The first lesson is simple: IPO excitement and intrinsic value are two different things.
When an extremely anticipated company lists, there can be enormous pent-up demand. The initial price movement can therefore reflect scarcity, momentum and sentiment—not necessarily fundamental valuation.
The subsequent correction is a reminder that eventually the market comes back to fundamentals.
For investors, I would avoid asking:
“How much can this stock rise on listing day?”
“At this valuation, what assumptions about future growth am I buying?”
If the valuation already assumes near-perfect execution for the next five years, even a great company can be a poor investment at that price.
Q) Can an Indian resident invest in a US IPO such as Anthropic?
A) In principle, yes—but access depends on the IPO structure, eligibility and the intermediary offering the opportunity.
For an Indian retail investor, investing in a US IPO is different from buying an already-listed US stock.
The investor needs an appropriate overseas investment route and must comply with India’s Liberalised Remittance Scheme (LRS), FEMA requirements, KYC, and applicable tax/reporting requirements.
And importantly, just because a company is going public in the US doesn’t mean every Indian brokerage will provide IPO allocation.
So, I would distinguish between:
US IPO access → allocation availability + eligibility + regulatory compliance
US listed-stock access → generally easier once the stock is trading publicly.
Q) How does pre-IPO investing work for an Indian retail investor?
A) Pre-IPO investing is fundamentally different from buying a listed share.
Before listing, shares may be available through:
institutional/private funds.
But retail access can be restricted, and minimum ticket sizes can be significantly higher than normal stock investing.
The biggest risk isn’t simply market volatility. It is liquidity risk.
You may own an attractive company but have no ability to sell the investment for years.
As a CTO, I would also add another risk: information asymmetry. Private companies generally disclose much less information than public companies.
So pre-IPO investing should be treated more like private-market venture investing than normal stock-market investing.
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Q) What paperwork does an Indian investor need?
A) At a high level, the investor typically needs the standard KYC and tax documentation required by the intermediary, such as:
PAN
Form W-8BEN for US tax status
An account with a permitted overseas brokerage/platform
Any additional FATCA/CRS declarations required by the intermediary
The exact documentation can vary depending on whether you’re investing directly through an overseas broker, an Indian intermediary, an investment platform, or a fund.
And this is an area where I would strongly recommend checking the current RBI, FEMA, tax, and intermediary requirements before remitting money, because regulations and reporting requirements can change.
Q) Is taxation different for a US IPO, US-listed stock, mutual fund, or ETF?
A) Yes, the structure matters.
The important distinction is not necessarily “IPO vs listed stock.” Once an IPO is completed and you hold the shares directly, the taxation framework generally depends on the nature of the investment, holding period, residency, and applicable Indian tax rules.
You also need to consider:
US withholding tax on dividends
Foreign asset disclosure/reporting requirements
Tax treatment can differ from directly owning shares
Fund domicile and structure matter
Distribution and capital-gain treatment need to be evaluated separately
US IPO
If you receive shares through an IPO and subsequently sell them, you’re generally dealing with the taxation of the underlying foreign equity investment.
The IPO itself doesn’t automatically create a special “IPO tax regime” in India.
There can also be TDS/remittance implications under LRS and foreign-tax-credit considerations, so investors should evaluate the complete transaction rather than looking only at the brokerage statement.
If I were looking at Anthropic, SpaceX or any other high-profile AI/technology IPO, I wouldn’t start with the IPO price. I’d start with the architecture of the business.
Technology → Product → Adoption → Unit Economics → Moat → Valuation
If the technology is exceptional but the economics don’t work, it’s not enough.
If revenue is growing but the moat is weak, competition can compress margins.
If the moat is strong but the valuation assumes unrealistic growth, a great company can still be a bad investment at the wrong price.
And that’s particularly relevant for AI today: we shouldn’t confuse the size of the AI opportunity with the amount of value that will ultimately accrue to any one company.
Disclaimer: This is a market/technology perspective, not personalised investment, or tax advice; Indian investors should verify the current FEMA/LRS and tax rules with their broker/CA before investing.
(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)
