It’s raining IPOs in 2023- 50 IPOs raise over Rs 52,000 crore

Companies raised over Rs 52,000 crore through mainboard IPOs in 2023, demonstrating resilience amidst global volatility driven by rising interest rates and geopolitical risks. 

However, the number of issues rose, marking a dynamic trend. Despite this, experts maintain a strong bullish outlook on the IPO market for 2024. Excluding LIC’s blockbuster maiden public issue of Rs 20,557 crore in 2022, the collection from initial public offerings (IPOs) increased by an impressive 36% this year.

2023 has unequivocally been the year of initial public offerings, witnessing 173 small and medium-sized enterprises (SMEs) and 52 mainboard listings. The market has seen outstanding debuts and subscriptions.

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Reflecting the buoyancy of the Indian stock markets. Despite expectations of significant volatility in the upcoming year, experts believe that the primary market will continue to gain momentum.

“The year 2023 has been a landmark year for the Indian IPO market, with as many as 50 companies going public and collectively raising over Rs 65,000 crore. This IPO frenzy not only reflects the buoyancy of the Indian stock markets but also the growing appetite among companies to tap into public markets for capital,” said Sonam Srivastava, Founder and Fund Manager at Wright Research. 

Looking ahead, around 24 companies, already cleared by the markets regulator Sebi, are set to raise over Rs 26,000 crore. Additionally, 32 more companies have filed their draft papers with Sebi and are awaiting clearances to mobilize more than Rs 35,000 crore, as per data provided by Prime Database.

The attention to fundamentals appears to be paying off, with only seven out of the 50 companies listed in 2023 opening at a discount, compared to 14 companies in 2022. The average gain on the listing day of stocks that debuted in 2023 stood at 29.5%, a significant improvement from 10.72% in 2022, according to Prime Database.

Shares of Tata Technologies, IdeaForge, and Utkarsh Small Finance Bank more than doubled or nearly doubled on the listing day itself, signaling positive days ahead for the IPO market in 2024.

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Several companies, including Oyo, Ola, and Go Digit, are expected to enter the market in 2024 after previously postponing their plans. Last year, in an interaction with DealStreetAsia, Gupshup Chief Executive Officer Beerud Sheth said the company would be looking to go public in the next calendar year, waiting for better market conditions.

According to Srivastava, the diversity of companies listing on the stock exchanges, ranging from tech startups to traditional businesses, indicates a broad-based interest in equity financing. However, this surge in IPOs also calls for cautious optimism among investors.

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