The Indian IPO market has witnessed a historic surge in September 2024, setting new records with an unprecedented number of IPO filings. A total of 41 companies submitted their documents, with 15 filings on the last day of the month alone, marking the highest-ever monthly tally.
Massive Fundraising on the Horizon
As of now, 25 companies are set to raise ₹63,550 crore, having already secured approval from the Securities and Exchange Board of India (SEBI). Meanwhile, 48 other companies are awaiting Sebi’s nod to raise an additional ₹91,805 crore, potentially pushing the total fundraising to over ₹1.55 lakh crore.
Key Factors Driving the IPO Surge
This surge in IPO activity is largely driven by:
- Strong Retail Participation: Retail investors are fueling the IPO boom, eager for listing gains.
- Oversubscription of IPOs: Many offerings have seen significant oversubscription, with investors flocking to capitalize on immediate returns.
According to a Sebi study, approximately 54% of IPO shares (by value) were sold within a week of listing, with non-institutional investors selling 63.3% of their shares and retail investors offloading 42.7% during the same period.
Biggest Upcoming IPOs of 2024
Several major companies are gearing up to go public in the coming months, leading the charge in fundraising:
- Hyundai Motor India is set to raise ₹25,000 crore.
- Swiggy is planning an IPO worth ₹11,000 crore.
- Afcons Infrastructure (Shapoorji Pallonji Group) targets ₹7,000 crore.
- Tata Play (formerly Tata Sky) aims for ₹2,500 crore.
- SK Finance is looking to raise ₹2,200 crore.
These companies have already secured approval from SEBI, with many more big names like NTPC Green Energy (₹10,000 crore), Hexaware Technologies (₹9,950 crore), and Vishal Mega Mart (₹8,000 crore) awaiting clearance to enter the IPO market.
What Should Investors Look For?
Amidst this IPO frenzy, investors must exercise caution when selecting which IPOs to invest in. Experts recommend evaluating two critical factors:
- Company Quality: Assess the company’s leadership, corporate governance, financial health, and growth strategy.
- IPO Valuation: A strong company with a poor valuation may still yield disappointing returns.
With global investors and mutual funds bringing in nearly ₹40,000 crore every month, the availability of funds is propelling IPO activity to new heights. This makes the Indian IPO market especially attractive to both domestic and international investors.
Conclusion: Preparing for a Busy IPO Season Ahead
As we approach the end of 2024, the Indian IPO market is set to remain vibrant, powered by growth-stage companies, enthusiastic retail investors, and abundant liquidity. Whether you’re a seasoned investor or new to the stock market, it’s crucial to evaluate each IPO carefully to make the most of this historic boom.