AI, Markets and the Mirage of Momentum

☕🗞️ Good morning! Welcome to The Brief, Edition #12

This week we dive into the AI wave propelling US market indices to record highs and how the technology narrative in India’s public markets is starting to take root. Also catch up on all the important news and developments from India’s consumer, startup and venture capital markets.

Before we dive in, a quick introduction to who we are.

Lightbox is a Mumbai-born venture capital firm focused on technology-led consumer businesses. Over the past decade we’ve employed a concentrated portfolio construction and deep operational engagement to enable our portfolio companies and limited partners to navigate this market.

India is moving steadily towards becoming a $10 trillion economy, driven by rising consumption and digital adoption. We believe we are uniquely positioned to offer a front-row seat to the most important shifts in the country’s consumer markets. If you’re a global capital allocator, family office, UHNI, or strategic investor looking to participate in the India opportunity — this newsletter is for you.

Let’s get into it.

📡 Signals

India’s AI Playbook: Pragmatism Over Hype

There’s a growing sense of déjà vu in the US markets. Nvidia, the chipmaker at the heart of the AI boom, has become the poster child of the ongoing rally, almost single handedly lifting indices to new highs over the past few weeks. And with it, questions are mounting. Chiefly, does the current environment echo the excesses of the dotcom era?

Technology investing has always been a mix of numbers and narrative. Earnings matter, but so does belief. That’s what makes this moment complicated. On one hand, we could be in the early stages of a genuine transformation and on the other, we could just be telling ourselves a really convincing story. The danger isn’t just overvaluation – it’s the assumption that the current winners will remain unchallenged. That’s never been true for long.

India is still in the early innings of its AI journey. While global markets ride a wave of exuberance, here the conversation is more grounded. Investors are still grappling with fundamental challenges that need solving, and AI is seen as one tool in the arsenal rather than the core of the solution. This restraint may prove to be India’s advantage. The scale of our problems requires pragmatic applications, not moonshots.

We’re not building foundational AI models or infrastructure yet. But the narrative around technology is taking root. New-age listed companies like Zomato, Nykaa, Mamaearth and Delhivery aren’t foundational technology companies; they’re brand-driven, low-margin businesses enabled by technology. That doesn’t make them less relevant. Much like Amazon, which is equal parts logistics, retail, and cloud infrastructure, these Indian startups are using technology to change how goods and services reach consumers.  

The opportunity lies not in building the next AI model, but in using technology to build scalable, trusted brands in a market that still overwhelmingly buys unbranded, fragmented products. It’s not transformational in the Silicon Valley sense, but it’s important.

We tend to overestimate the impact of new technologies in the short term and underestimate it in the long term. That’s the moment we’re in. We’re betting on possible futures, and in doing so, reshaping what gets built today. At Lightbox, we’ve always been cautious about mistaking noise for signal. But we also know that belief drives boldness and that's what creates category-defining businesses. The challenge is in separating momentum from merit, hype from durability. That’s where the work lies.

📰 News

Theobroma Has a New Owner; Plum Expands to Healthcare Services

ChrysCapital snaps up bakery QSR chain Theobroma

ChrysCapital is set to acquire a controlling stake in premium bakery chain Theobroma for ₹2,410 crore. The homegrown private equity firm will buy nearly 90% of the company from the founding family and ICICI Venture, with the remaining 10% expected to be retained by existing shareholders. ICICI Venture, which invested ₹30 crore in Theobroma in 2021, is poised to earn nearly a 3x return on its exit. This is ChrysCapital’s second major consumer bet this year, following its investment in Bikaji in March. Theobroma reported revenue of around ₹400 crore in FY24 and is projected to reach ₹550 crore, with an estimated Ebitda of ₹80–100 crore.

Indira IVF lines up for an IPO

Indira IVF, backed by EQT, is reviving its IPO plans in India to raise up to ₹3,500 crore ($408 million) through a fully secondary share sale. EQT will sell shares worth ₹2,900 crore, while three founding family members — Ajay, Kshitiz, and Nitiz Murdia — will each offload ₹200 crore worth. The company had previously withdrawn its draft IPO in March amid regulatory concerns linked to a biopic on its founder. Indira IVF operates over 155 centres with 315 specialists across India. Kotak, IIFL, JPMorgan, and UBS are advising on the deal.

Udaan Acquires ShopKirana to Deepen Bharat Reach Ahead of IPO

B2B e-commerce platform Udaan has acquired Indore-based ShopKirana in an all-stock deal to strengthen its position in FMCG and HoReCa categories, expand deeper into Tier 2 and 3 cities, and sharpen its focus on profitable growth. The move aligns with Udaan’s IPO roadmap and follows its recent $114 million Series G fundraise led by M&G Investments and Lightspeed, with Info Edge joining its cap table. ShopKirana’s strong presence in cities like Indore, Bhopal, Agra, and Meerut complements Udaan’s national reach, enabling deeper penetration into high-frequency FMCG segments. The merger is expected to unlock synergies in sourcing, credit, and supply chain, and accelerate contribution margin improvements.

Plum is the latest insurtech to move towards healthcare delivery services

Bengaluru-based insurtech startup Plum is moving beyond its core  business with the launch of Plum Health—a new vertical focused on diagnostics, teleconsultations, and AI-powered health tracking for India’s working professionals. Having turned its insurance operations Ebitda-positive in H2 FY25, the Tiger Global-backed company is now betting on healthcare as a long-term parallel business. “This isn’t a feature rollout—it’s a new business altogether. We’re building Plum Health like a startup within a startup,” the company said. The move reflects a broader trend among insurtechs to go deeper into healthcare delivery, as they look to expand their relevance and revenue beyond policy distribution.

Kedaara Capital joins the continuation fund bandwagon

Kedaara Capital is close to raising a $200-300 mn continuation fund. At least two trophy assets, Lenskart and Care Health Insurance, will be rolled into the fund. UK’s Pantheon Ventures is reported to be leading the deal. The continuation fund mirrors a trend among Indian PE firms such as Multiples and ChrysCapital that are increasingly using continuation vehicles amid tightening liquidity. With limited partners cautious, continuation funds are becoming a vital tool in India’s PE landscape for managing fund lifecycles and portfolio exits. The trend also underscores the increasing sophistication of exit strategies in Indian private equity and reflects a maturing ecosystem.

Luggage maker VIP’s promoters sell out to PE consortium

The Promoters of VIP Industries have sold a 32% stake to a consortium led by Multiples PE, along with Mithun Sancheti and others. The deal, involving over 4.5 crore shares, will trigger an open offer and result in the buyers taking control of the company. Dilip Piramal and family, the outgoing promoters, retain the right to nominate one board member and have a tag-along clause in case of a future sale.

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