Indian companies have set a new record in 2024, raising over Rs 1.22 lakh crore through initial public offerings (IPOs), surpassing the previous high of Rs 1.18 lakh crore set in 2021. Despite the milestone, enthusiasm in the primary market shows signs of cooling as several recent IPOs struggled to deliver expected gains.
Around 70% of the funds were raised since August, with October setting an all-time monthly record of approximately Rs 38,700 crore, overtaking the previous record from November 2021. This strong rally in fundraising continued through August and September, with totals of Rs 17,109 crore and Rs 11,058 crore, respectively.
Looking ahead, November will see four major IPOs, including Swiggy, Sagility India, ACME Solar Holdings, and Niva Bupa Health Insurance, collectively aiming to raise Rs 19,334 crore.
However, a decline in investor enthusiasm followed Hyundai Motor’s disappointing debut, where the stock listed 10% below its issue price. This trend extended to other IPOs like Deepak Builders & Engineers, which opened 20% below its issue price, further contributing to a subdued market mood. Even Waaree Energies, initially expected to debut at a 90% premium, listed at a more modest 59% premium.
Analysts attribute this tempered sentiment to continued selling pressure from the FIIs, coupled with poor domestic earnings. This helps explain why analysts have been extra cautious when advising on forthcoming IPOs, more so in the case of Swiggy, which, despite its high-profile issue, faces extra scrutiny for its loss-making status, and its resultant valuation some would argue overestimates its true worth.
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Source: Moneycontrol
News Desk
