India’s equity market is buzzing with activity as numerous companies line up for initial public offerings (IPOs). Ola Electric Mobility, Swiggy, National Securities Depository Ltd (NSDL), Afcons Infrastructure, and FirstCry’s parent company BrainBees Solutions have all filed with the Securities and Exchange Board of India (SEBI) for their IPOs. Tata Capital, JSW Cement, and Hexaware Technologies are also expected to join this trend, reflecting strong investor interest and the growth of India’s primary markets.
Massive IPO Lineup
Barely into the financial year, share issuances totaling over ₹50,000 crore (about $6 billion) have been lined up for FY 2024-25, excluding the SME IPO market. This is about 85% of the ₹61,915 crore raised by 76 companies through mainboard IPOs in FY24. The previous year saw 37 companies raising ₹52,116 crore. Investment bankers predict that FY25 will see even more and larger IPOs.
Munish Aggarwal, Head of Equity Capital Markets at Equirus, expects primary issuance activity in FY25 to easily surpass ₹1.5 lakh crore (₹1.5 trillion, or about $18 billion) unless market volatility significantly increases. India’s IPO market has previously crossed the ₹1-trillion mark only once, in FY22, with companies like Paytm and Nykaa leading the way.
Growing Investor Appetite
Amit Thawani, head of investment banking at Nomura India, anticipates several IPOs in FY25 to exceed $1 billion. According to Prime Database, 40 companies with a combined estimated issue size of ₹53,515 crore have filed offer documents with SEBI and are awaiting approval. Another 19 companies with a combined estimated issue size of ₹11,901 crore have already received SEBI approval.
Companies like Blackstone-backed Aadhar Housing Finance, Carlyle-backed Indegene, GoDigit General Insurance, and General Atlantic-backed TBO Tek have collectively raised over ₹6,000 crore just in May. Swiggy, Ola Electric, and Carlyle-owned Hexaware are also expected to launch billion-dollar IPOs soon.
Rising Average Issue Size
Experts believe the average size of IPOs will significantly increase in FY25. Neha Agarwal of JM Financial expects many large issuances, particularly in consumer, tech, financials, and healthcare sectors. Companies like health insurer Niva Bupa and digital health platform IKS Health are preparing for $300-500 million fundraises.
Afcons Infrastructure and Waree Energies are among those planning large issuances. Afcons aims to raise about ₹7,000 crore (nearly $850 million), while Waree has filed to raise ₹3,000 crore (about $360 million).
Election Impact and Market Sentiment
Despite initial concerns about a slowdown in IPO activity ahead of the general election, the market has remained robust. Between January and mid-May, 27 companies went public, with an average listing gain of 28%.
Samir Bahl of Anand Rathi Advisors notes that contrary to expectations, the primary market has thrived. This strong performance underscores confidence in India’s long-term economic prospects. Other forms of capital raising, such as FPOs, rights, and preferential issues, are also increasing, with Vodafone Idea opening its ₹18,000-crore FPO recently.
High market valuations are encouraging promoters and early investors to cash in on their holdings, while investors are buoyed by the strong performance of recent IPOs, which have typically listed at a premium to the issue price.
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