Indian IPO Boom Continues: Rs 60,000 Crore in Share Sales Lined Up for New Year

As 2023 comes to a close, the Indian IPO market continues its remarkable surge, attracting both retail and institutional investors. The year witnessed a record-breaking number of mainboard Initial Public Offerings (IPOs) and set the stage for an even more exhilarating start to 2024, with approximately Rs 60,000 crore in share sales lined up.

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In 2023, a total of 57 Indian companies successfully raised approximately Rs 49,000 crore through mainboard IPOs, according to data from Prime Database. Additionally, 27 companies have received regulatory approval to launch their public offerings, with an estimated fundraising target of around Rs 29,000 crore. Furthermore, 29 other companies are currently awaiting regulatory clearance, collectively seeking to raise approximately Rs 34,000 crore.

Primary Market IPO DATA

The year 2023 saw the second-highest number of mainboard IPOs in over a decade, and this IPO frenzy shows no signs of slowing down. Analysts attribute this exuberance to a combination of factors, including robust economic growth, ample liquidity, anticipated interest rate cuts by global central banks, and expectations of political continuity beyond the upcoming Lok Sabha elections.

Market participants are eagerly awaiting the entry of high-profile companies into the primary market in the new year, including Ola Electric, Swiggy, and FirstCry, which are reportedly looking to raise $500 million (approximately Rs 4,000 crore) each.

Analysts are optimistic about the market’s performance in the first half of 2024, fueled by potential rate cuts by both the US Federal Reserve and the Reserve Bank of India (RBI). Additionally, the expected victory of the Bharatiya Janata Party (BJP) in the general elections scheduled for May 2024 is anticipated to provide further momentum to the ongoing market rally.

Mohit Ralhan, CEO of TIW Capital, remarked, “IPO activity has been robust this year, and the momentum is expected to continue into 2024. There is eagerness among investors to tap capital markets ahead of the general elections. This seems a prudent strategy as well given that historically, Indian equities have usually done well heading into general elections.”

Back in Business 2023 IPO Data

In December 2023, amid the surging local equity markets, 11 companies raised approximately Rs 8,256 crore through IPOs. The benchmark Sensex and Nifty indices posted impressive gains of nearly 15 percent each in 2023, with BSE midcap and smallcap indices soaring approximately 45 percent and 50 percent, respectively.

Looking ahead to 2024, investors are eagerly anticipating IPOs from notable companies such as Ebixcash, Tata Play, Indegene, Oravel Stays (OYO), Go Digit General Insurance, and TBO Tek.

Experts suggest that with improved investor sentiment, private equity and venture capital funds are becoming more active and are seeking opportunities to monetize their assets. This bullish sentiment is driving their interest in exits through IPOs or bulk deals.

Analysts also predict that traditional sectors such as manufacturing and financial services will continue to witness strong IPO activity in the new year. Manufacturing firms are particularly favored, benefiting from India’s increasing capital expenditure and a slowdown in industrial activity in China.

Disclaimer: The views and investment tips mentioned in this article are based on expert opinions and should be considered for informational purposes only. Investors should conduct their own research and consult with financial advisors before making investment decisions.

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