Profitability Over Growth: India’s New-Age Tech Giants Reset Strategy

Updated: November 14, 2025 02:11

Image Source: Business Today

India’s leading tech stocks—Zomato, Nykaa, and Paytm—are shifting gears from aggressive expansion to profitability. Recent earnings highlight improved margins, cost discipline, and operational efficiency. Analysts note this pivot reflects investor demand for sustainable returns, marking a new phase for internet-first companies that once prioritized scale over financial stability.

Tech Unicorns Enter Maturity Phase

After years of chasing growth through customer acquisition and market expansion, India’s new-age tech firms are now emphasizing profitability and operational efficiency. This strategic reset comes as investors demand stronger fundamentals and consistent earnings visibility.

Key Highlights from Recent Performance

Zomato

Food delivery growth is moderating, but quick commerce (Blinkit) continues to expand through dark-store networks.

Focus on unit economics and cost control has improved contribution margins.

Analysts expect profitability to stabilize as delivery volumes plateau.

Nykaa (FSN E-Commerce Ventures)

Reported a 243% YoY surge in net profit in Q2FY26, reaching ₹34 crore.

Revenue grew 25% to ₹2,346 crore, with gross margins at a 12-quarter high.

Strong performance in beauty and personal care (BPC) segment, supported by efficient inventory management.

Paytm (One97 Communications)

Earnings remain flat sequentially, but merchant loans and operating leverage are driving margin improvement.

Focus on financial services and lending partnerships rather than cash-burning customer incentives.

Analysts highlight Paytm’s pivot toward sustainable fintech profitability.

Broader Context

Investor sentiment: The market is rewarding companies that demonstrate profit discipline, with valuations stabilizing after years of volatility.

Sectoral shift: The emphasis on profitability signals the maturity of India’s internet economy, moving beyond “growth at all costs.”

Operational efficiency: Cost optimization, better unit economics, and diversified revenue streams are now central to strategy.

Global parallels: Similar pivots have been seen in global tech firms, aligning Indian players with international investor expectations.

Outlook

The transition from growth-first to profit-first strategies marks a new chapter for Indian tech unicorns. While expansion remains important, the ability to deliver consistent earnings will define leadership in the sector. Analysts expect continued margin improvement across food delivery, e-commerce, and fintech as these firms balance scale with sustainability.

Sources: Business Today, Mint, Economic Times

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