EVs Power Cleantech Funding Boom
India’s cleantech story accelerated in Q3 2026. The quarter saw the sector nearly triple its funding volume on the back of big-ticket electric mobility rounds and rising deal activity. So, what’s pulling investors towards the sector and can the momentum extend beyond EVs?
The Cleantech Boom: As per Inc42 data, Indian cleantech startups raised a record $433 Mn in Q3 2026, nearly 3X from $118 Mn in the year-ago quarter. Although funding remained heavily concentrated in one segment, the sector’s broader momentum was evident: deal count rose 44% YoY to 23, while average cheque size zoomed to $19 Mn from $7 Mn in Q3 2025.
The EV Concentration: Within cleantech, electric mobility dominated funding charts in Q3. Just three EV startups – River, Yulu and Ultraviolette – raised a combined $298 Mn, nearly 69% of the sector’s total haul in the quarter. The concentration highlights the sector’s over-dependence on a small group of well-funded ventures.
Decoding The Boom: Cleantech funding surged as investors shifted their focus from climate narratives to commercially-viable businesses solving real problems. Electric mobility led the charge, supported by rising EV registrations, stronger consumer demand and improving PMF. What also helped was rising component localisation and growing investor confidence.
The Road Ahead: Experts believe that the sector’s long-term outlook will depend on broadening investment beyond EVs to other emerging areas such as energy storage, grid tech and green hydrogen. They also see deeper localisation improving margins and reducing supply chain risks. As such, unit economics and a clear path to sustainable revenues will be a key focus area for backers going forward.
As investor conviction expanded across the cleantech ecosystem in Q3, why did capital remain tightly locked within a handful of EV players? Let’s find out…
From The Editor’s Desk
The AI Safety Drill
- OpenAI, Anthropic and other AI giants are rehearsing how they would respond to a catastrophic incident involving AI. The companies are set to engage with US lawmakers as experts believe a major AI incident could happen within 12 months.
- The planning comes as AI companies look to avoid a serious failure, which could prompt sweeping public backlash, new restrictions and scrutiny of industry leaders. The fear is that a major AI incident could impact internet infrastructure or financial systems.
- The safety drill comes as LLMs find software vulnerabilities and coordinate agents. In the past few months, both OpenAI and Anthropic have reported several instances, where their agents bypassed safeguards and accessed real-world infrastructure.
Weekly Startup Funding Tanks
- Indian startups managed to raise a cumulative $123 Mn last week, down 47% from $234 Mn in the preceding week. However, deal count more than doubled week-on-week to 25. DailyObjects and Lumio emerged as the most funded startups last week.
- Ecommerce dominated the funding charts last week, raising $63.9 Mn across nine deals. Fintech ranked second with $24 Mn in funding, followed by advanced hardware and technology at $10 Mn.
- Early-stage funding trends remained strong as pre-seed and seed-stage startups collectively bagged $12.5 Mn across nine deals. 3one4 Capital and Fireside Ventures emerged as the most active investors, backing two startups each.
Mixed Week For Startup Stocks
- Of the 66 new-age tech stocks under Inc42’s coverage, 36 gained in the range of 0.1% to nearly 25% last week. The remaining 30 fell in the range of 0.23% to 13.93%. MobiKwik and PW emerged as the biggest gainers, while Yudiz and Zappfresh shed the most.
- The combined market capitalisation of 67 new-age tech stocks, including the recently listed AceVector, stood at $154.71 Bn at the end of last week compared to $153.61 Bn for 66 companies in the preceding week.
- Going forward, investors will be tracking inflation data, crude oil prices, progress in Iran-US negotiations and global bond yields for market cues next week.
Nat Habit Bags ₹142 Cr
- The D2C personal care brand has raised around $14.7 Mn in its Series C round led by Trident Growth Partners to expand its distribution network, product portfolio and manufacturing capabilities.
- Founded in 2019, Nat Habit sells Ayurveda-based personal care products, including hair oils, masks, scrubs, and face creams. Having served 60 Lakh customers so far, the D2C brand currently claims to clocking ₹330 Cr in annualised gross revenue.
- The funding comes amid growing investor interest in the homegrown ayurvedic wellness segment, which is being driven by growing demand for traditional formulas, the rise of quick commerce, premiumisation and multi-functional products.
India’s Listed Startup Tracker
- India is home to over 70 listed new-age tech companies, with a combined market capitalisation of $173 Bn. Of this, 18 startups went public in 2025 and another 15 have already crossed the milestone this year so far.
- Together, these listed startups boast a combined revenue of $26 Bn. A majority of these new-age tech companies, nearly 74%, are profitable, while the remaining posted a cumulative loss of $932 Mn in FY26.
- Delhi NCR is home to the largest number of listed startups. On the sectoral front, fintech and ecommerce account for the biggest chunk of listed new-age tech companies.
Inc42 Markets
Inc42 Startup Spotlight
Turning Agri-Waste Into Steel Industry’s Next Big Power Bet
India’s steel industry still runs largely on coal, while millions of tonnes of agricultural waste goes waste every year. Climitra is connecting these two problems by converting waste biomass into industrial-grade biochar, offering industries a route to carbon removal.
Turning Waste Into Fuel: Founded in 2025, Climitra is building a vertically-integrated startup to convert biomass into bio-coal. It uses AI and geospatial intelligence to map and assess biomass availability, and then converts locally-sourced waste into fuel through a proprietary pyrolysis process.
A Coal Substitute: Climitra’s bio-coal is designed as a 1:1 replacement for fossil coal in steel-making, reducing the need for costly furnace retrofits. The startup claims that its output contains 75-85% fixed carbon, has a gross calorific value of 6,500–8,000 kcal/kg and can cut emissions by up to 90% compared with fossil coal.
Beyond Bio-Fuel: Climitra’s business model extends beyond bio-fuel. The startup is targeting both industrial decarbonisation and carbon removal, using its existing biomass supply chain. The startup claims it has already validated its bio-coal with Tata Steel, JSW Steel and AM/NS India.
Backed by InfoEdge Ventures, the startup is eyeing a piece of the Indian biomass briquette market, which is projected to become a $2.1 Bn opportunity by 2032. So, can Climitra turn agricultural waste into a lower-carbon fuel for its steel industry?
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