India sees no main-bourse IPOs in 3 weeks amid market correction and selloff
After heightened exercise in 2024, there was a slowdown in new listings, with no main-bourse IPOs hitting the market previously three weeks resulting from a correction within the secondary market.
This slowdown in IPO exercise is mirrored within the numbers, as solely 5 corporations went public in January and 4 in February, in comparison with 16 listings in December 2024.
High quality Energy Electrical Gear Ltd was the latest IPO which opened for three-day bidding on February 14. Nevertheless, the pattern of slower exercise is obvious as no less than three corporations – Superior Sys-tek, SFC Environmental Applied sciences, and Viney Company – withdrew IPO plans by pulling their draft papers in January and February.
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This shift follows a exceptional 2024 during which 91 maiden public points collectively raised ₹1.6 lakh crore, pushed by strong retail participation, a resilient economic system, and booming non-public capital expenditure.
Bhavesh Shah, Managing Director and Head of Funding Banking at Equirus, instructed PTI that the slowdown is essentially a results of the secondary market correction, particularly in January and February, which negatively impacted the share costs of a number of listed corporations. Because of this, buyers have shifted focus to their present portfolios quite than exploring new listings.
Shah emphasised that the diminished investor consideration on new IPOs has contributed to the slowdown in market exercise.
Regardless of this warning, V. Prashant Rao, Director and Head of ECM Funding Banking at Anand Rathi Advisors, identified that the longer-term outlook stays constructive, with a robust IPO pipeline.
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“We’re seeing a powerful variety of paperwork getting filed and ready for market situations to stabilize. Presently, 45 corporations with Sebi approval wish to elevate over ₹67,000 crore and 69 corporations are awaiting Sebi-approval, aiming to lift over ₹1.15 lakh crore. Notably, out of the 69 corporations, 45 corporations filed DRHPs within the final couple of months,” he mentioned.
Within the final two months alone, near 30 corporations have filed preliminary IPO papers with Sebi, and as well as, Information Realty Belief– sponsored by Sattva Group and Blackstone– final week filed paperwork to launch its maiden REIT public challenge to lift greater than ₹6,200 crore.
This inflow of filings means that whereas market situations are at the moment subdued, the IPO market just isn’t stagnant.
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Wanting forward, Equirus’ Shah stays optimistic, forecasting a revival of the IPO market within the subsequent few months as market situations stabilise. He believes that buyers will finally return to recent investments in new corporations, supported by sturdy mutual fund inflows, which proceed to point out resilience regardless of some influence from market volatility.
To keep up investor curiosity amid these fluctuating situations, Shah means that issuers could must recalibrate their IPO valuations in step with the present market realities, probably providing extra engaging pricing to entice buyers.
“To maintain investor curiosity amid this volatility, the businesses could do some changes within the IPO pricing, probably providing extra engaging valuations,” Anand Rathi Advisors’ Rao mentioned.
