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Several elements, consisting of exclusive equity departures, sponsor-driven sales, and changes in company financing methods, have actually likewise driven the IPO task.
Several elements, consisting of exclusive equity departures, sponsor-driven sales, and changes in company financing methods, have actually likewise driven the IPO task.
Fundraising by means of IPOs in India struck an additional spots as financial development, good market problems and renovations in the governing structure assisted firms increase a document Rs 1.6 lakh crore in 2024, while the pipe for the following year holds up larger assurance.
This extraordinary year not just mirrored the self-confidence of companies yet likewise highlighted financiers’ passion to confiscate listing-day gains or back firms with solid lasting development possibility.
Key Milestones and Historic IPOs
The year was noted by Hyundai Motor India’s historical IPO, the biggest in the nation’s background, which increased Rs 27,870 crore.
Companies of differing market capitalisations– huge, mid, and little– used the IPO course in 2024, with the typical problem dimension increasing substantially from Rs 867 crore in 2023 to over Rs 1,700 crore in 2024, according to an evaluation by information company PTI
The extraordinary vibrancy of the IPO market appeared, with December alone seeing a minimum of 15 launches.
Factors Driving IPO Momentum
“Rising retail involvement, solid residential inflows and energetic involvement by FPIs (despite the fact that they have actually been web vendors in the additional market), exclusive capex boost and the federal government’s calculated concentrate on facilities and crucial industries have actually jointly laid a solid structure for the fundraising energy in India,” V Prashant Rao, Director & Head – ECM, Investment Banking at Anand Rathi Advisors, said.
Expectations for 2025
Fundraising momentum is expected to accelerate further in the New Year, potentially surpassing 2024’s record figures, market analysts said.
“Based on the 75 IPO documents, which are at various stages of approval/ marketing and the deal pipelines, we expect issuance activity in 2025 to cross Rs 2.5 lakh crore,” Munish Aggarwal, Managing Director and Head of Equity Capital Markets at Equirus, stated.
The IPO pipe for the following year is readied to include significant offerings, consisting of HDB Financial Services’ suggested Rs 12,500 crore problem, LG Electronics India’s Rs 15,000 crore public float, and Hexaware Technologies’ Rs 9,950 crore offering.
According to information readily available with the exchanges, 90 initial public problems were released in 2024, jointly increasing Rs 1.6 lakh crore. This consists of 8 IPOs arranged in conclusion on December 23-24. Besides, the Rs 500-crore IPO of Unimech Aerospace and Manufacturing is slated to open up on December 23.
Additionally, Vodafone Idea increased Rs 18,000 crore with a follow-on public deal (FPO).
About Rs 1.6 lakh crore increased in 2024 much surpassed Rs 49,436 crore amassed by 57 companies with IPOs in 2023.
2024 saw 63 firms increasing Rs 1.2 lakh crore, noting the very best IPO year in 20 years, driven by plentiful liquidity, enhanced retail capitalist involvement, and continual bliss in the key market.
SME Segment Growth
The revival in task likewise reached the SME section, where a document 238 little and moderate business increased Rs 8,700 crore, almost increasing the Rs 4,686 crore increased in 2023, according to the information offered by primedatabase.com.
This development shows raising passion in SME public offerings, although it features enhanced dangers for retail financiers.
In reaction, Sebi determined to present more stringent governing structures, consisting of productivity needs, a cap on the offer-for-sale (OFS) part and a “draw of great deals” system for non-institutional investors (NIIs) to safeguard smaller investors.
Factors Contributing to Robust IPO Activity
Experts attributed this year’s robust IPO activity to a stable economic environment, policy continuity at the central government level, and broad-based economic growth.
“Stable economic environment, policy continuity at the central government level combined with broad-based growth have encouraged companies and investors to raise funds. Foreign portfolio investors have also been big buyers, especially in the larger IPOs,” stated Pranjal Srivastava, Partner-Investment Banking at Centrum Capital.
Several elements, consisting of exclusive equity departures, sponsor-driven sales, and changes in company financing methods, have actually likewise driven the IPO task.
“The revival of production and enhanced exclusive capital investment are crucial factors as firms seek to money development and modernisation. Many organizations are likewise concentrating on expanding their financing resources by moving from debt-heavy designs to equity, making certain more powerful annual report and decreased utilize,” said Neha Agrawal, MD & Head, Equity Capital Markets at JM Financial Institutional Securities.
Largest and Smallest IPOs of 2024
Among the year’s largest main-board IPOs, Hyundai Motor India led the pack, raising Rs 27,870 crore, followed by Swiggy (Rs 11,327 crore), NTPC Green Energy (Rs 10,000 crore), Bajaj Housing Finance (Rs 6,560 crore), and Ola Electric Mobility (Rs 6,145 crore).
In contrast, Vibhor Steel Tubes launched the smallest IPO, raising just Rs 72 crore, indicating the diversity of companies accessing the capital markets.
For companies, going public provides crucial funds for expansion, working capital, and debt repayment while enhancing visibility and attracting new business opportunities. IPOs also serve as an exit strategy for long-term investors.
Exceptional Subscription Ratios and Listing Gains
Interestingly, the IPO subscription ratios have been exceptionally high this year. Vibhor Steel Tubes saw an impressive subscription of 320 times, while other offerings like KRN Heat Exchanger and Refrigeration, Manba Finance, and Gala Precision Engineering were each subscribed over 200 times.
Additionally, IPOs of companies like One Mobikwik Systems, Unicommerce eSolutions, Diffusion Engineers, BLS E-Services, and Exicom Tele-Systems were subscribed more than 100 times.
This strong demand translated into substantial listing gains, with over 60 companies delivering positive returns on their debut day.
Vibhor Steel Tubes, BLS E-Services, Bajaj Housing Finance and KRN Heat Exchanger delivered more than 100 per cent gain, reflecting robust investor demand.
Stock Market Performance
Meanwhile, India’s equity markets also saw record-breaking performances, with the NSE Nifty 50 reaching an all-time high of 26,216 points on September 27 and the BSE Sensex peaking at 85,836 points on September 26, supported by the country’s robust economic growth outlook.
What Is An IPO?
An IPO is the process through which a privately owned company sells its shares to the public for the first time, transitioning into a publicly traded entity. This allows companies to raise funds from public investors to support growth, repay debts, or achieve other business objectives.
In India, IPOs are regulated by the Sebi, which ensures companies comply with stringent guidelines and provide full financial and operational disclosures to safeguard investor interests.
(With PTI inputs)
