In the current month, at least nine companies across various sectors mobilised funds worth about Rs 10,350 crore ($1.25 billion) from the Indian primary market, and participants expect more to come by the end of the year.
According to sources, a handful of companies are likely to launch their initial stake sales in the last week of the current month. More IPOs launches are seen till mid-December – till the global investors go for their new year holiday.
Yogesh Tiwari, Senior Analyst,
, said that some IPOs are expected between the last week of November and the first half of December. They are smaller in size and include sectors like agrochemicals, engineering goods.
However, Amit Pamnani, Chief Investment Officer,
expects a ‘winter season’ at the primary market with only a few issues in the pipeline. “The number of issues have decreased, but the performance of IPOs has been good.”
Sula Vineyards, ESDS Software Solution, Dharmaj corp, Landmark Corp, Puranik Builders, KFin Technologies, Navi Finserv and Uniparts India are the key contenders which may launch their issue in the remaining 2022.
Experts believe that one shall not expect a dry season for the primary markets but investor’s interest and risk appetite have taken a hit after a long series of muted listings, which has dented both number and sizes of the issues.
According to Prime Database, 14 Indian companies raised more than Rs 35,450 crore via their initial offering during H1FY23. However, during the same period previous year, 25 firms mopped up close to Rs 52,000 crore via IPOs.
This year’s listing also includes the initial offer of Rs 20,557 crore by
(), the largest primary markets offering in India so far.
It may not be a dry season, said Tiwari. “The interest may be relatively muted as compared to 2021, but it will vary on a case-to-case basis.”
Experts suggest that crackdown in the listed startup counters has impacted the sentiments and not many new age companies are eyeing for the listing at astronomical valuations.
Pamnani said that many other companies, including Oravel Stays (Oyo) and API Holdings (Pharmeasy) will be returning to SEBI with addendums, and many of them are probably going to lower the value demands from their IPOs.
“Indian markets are noticed to be performing incoherently to the global markets. In addition to that, primary markets have seen a response from both retail as well as HNI investors,” he said.
2021 was a good year for IPOs as markets remained buoyant, but 2022 is not over yet. Experts continue to remain divided over action in the primary markets in the coming months.
Despite a strong pipeline of approvals, IPO winter may continue till the last quarter of the ongoing fiscal as the valuations have taken a hit and as the companies will wait for right sentiments, said Pamnani from Swastika.
Contrary to his view, Tiwari from Arihant Capital said that Q4FY23 is likely to be a good period for primary markets as stock markets gather steam post correction in mid-2022.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
