October IPO Boom: 21 Dalal Street Listings Soar as Investor Interest Stays Strong Despite Market Losses

In October, while the secondary stock market struggled with big losses, the IPO market stayed strong. Investor interest in new listings remained high, even with market volatility.

So far, 21 companies have been listed on Dalal Street this month, and six more are expected to be listed soon, bringing the total to 27. This shows that the primary IPO market is still active, even as the broader stock market faces challenges.

The biggest IPO of the month was Hyundai India, raising ₹27,870 crore through the Offer for Sale (OFS) route. However, retail investors showed less interest than expected, resulting in a lower-than-anticipated subscription rate.

Some experts think that retail investors were cautious because they believed the Hyundai IPO was priced too high, leaving little room for gains after the stock listed. Recently, large IPOs like Ola Electric Mobility, LIC, and Paytm have seen smaller listing gains compared to earlier IPOs.

Out of the 21 stocks that debuted in October, 17 were from the SME (small and medium enterprise) segment, while four were from the main board. The main board companies were Hyundai Motor India, Garuda Construction and Engineering, Diffusion Engineers, and KRN Heat Exchanger and Refrigeration.

These four companies raised a total of ₹28,633 crore, with Hyundai Motor raising the most. KRN Heat Exchanger made a particularly strong debut, with its stock opening at ₹478.80 per share, a 117.6% jump from its IPO price of ₹220.

At present, KRN Heat Exchanger’s stock is still trading 93.6% above its issue price. Diffusion Engineers and Garuda Construction also saw good starts, with their stocks listing 20% and 12% above their IPO prices, respectively. On the other hand, Hyundai Motor’s shares listed at a 7.2% discount to their IPO price of ₹1,960.

17 SME Stocks Make a Strong Debut

In the SME segment, 17 stocks were listed in October, and many received strong interest from retail investors. Seven out of 17 were subscribed over 100%. For example, Thinking Hats Entertainment was subscribed 329 times, and Freshara Agro Exports was subscribed 224 times. Sahasra Electronic Solutions and Techera Engineering India have been top performers, with their stocks currently trading 152% and 127% above their issue prices, respectively.

Retail investors have been particularly drawn to the SME category, hoping for high returns and the chance to invest in growing companies early. However, the Securities and Exchange Board of India (SEBI) has issued multiple warnings due to the risks involved.

Several companies are raising funds to repay debt, expand projects, and cover working capital needs, according to their Draft Red Herring Prospectuses (DRHPs).

Six more IPOs, which finished their bidding in October, are expected to be listed between October 28 and 29. These include Waaree Energies, Deepak Builders & Engineers India, Premium Plast, Danish Power, OBSC Perfection, and United Heat Transfer.