India’s initial public offering (IPO) market is set to hit previous fundraising highs ₹67,147 crore was seen in 2017, with high profile technology companies entering the market this week and next.
41 companies have picked up ₹66,973 crore through initial share sales in the first nine months of 2021, driven by tremendous liquidity and rising stock markets, according to data from primary market tracker Prime Database. Five IPOs led by Paytm, Nykaa and Policybazaar, set to raise more ₹30,000 cr through primary market in next few days, taking IPO fundraising to over ₹97,000 crores.
FSN E-commerce Ventures Ltd, which owns Nykaa, launched its IPO on Thursday ₹5,351 crore. Paytm will launch its ₹18,300 crore IPO on November 8 and ₹Policybazaar’s initial share sale of Rs 5,625 crore will open on November 1. Others opening soon include Fino Payments Bank and SJS Enterprises Ltd.
Activity in the IPO market is expected to continue at a brisk pace as dozens of other companies await approval from the Securities and Exchange Board of India (SEBI) to sell their shares.
“Among the big tech companies, we have only seen a small number of listings. In addition to the ongoing IPO, we are seeing a strong pipeline of other tech unicorns that are ready for public listing,” said Ravi Dubey, partner at law firm IndusLaw. “Given the regulatory flexibility and investor interest in the sector, special As for consumer technology, we expect large tech companies to last a long time. Many of these enjoy first mover benefits, which, combined with the optimistic sector outlook, makes it an attractive option. However, these are young companies and, therefore, a long-term perspective is needed on their development.”
Investor appetite for IPOs remains strong and has given investors sensational listing day gains in many cases. Companies like Paras Defense and Space Technologies Ltd., Tatva Chintan Pharma Chem Ltd., Indigo Paints Ltd. and GR Infraprojects Ltd. have given returns of over 100% when they listed investors this year. Retail investors are also betting heavily on IPOs in search of strong listing gains. On Thursday, the retail portion of the Nykaa IPO was subscribed over 100% within the first hour of the share sale.
However, some feel that the primary market may face difficulties in the coming days as some foreign brokerages have cautioned against the bullish valuations of the Indian stock markets.
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