The Great Indian IPO craze to continue in March Quarter: 23 Cos are ready to list
The great Indian IPO mania is not going to fizzle out anytime soon as nearly two dozen companies are raising nearly Rs 44,000 crore through IPOs (initial public offerings) in the March 2020 quarter.
Most of these funds will be cornered by technology-driven companies. It is to be noted that a whopping amount of Rs 1.2 lakh crore through IPOs in the 2021 fiscal year has already been mopped up even as the general gloominess of the broader economy seems not be in very good shape.
Apart from these companies, PowerGrid InvIT raised Rs 7,735 crore through its IPO (initial public offering), while Brookfield India Real Estate Trust (REIT) raised Rs 3,800 crore through REITs (real estate investment trust).
Hotel aggregator OYO and supply chain company Delhivery are expected to list on Indian stock exchanges during the March quarter of 2021. Firms that are expected to raise funds through their IPOs during the March quarter include hotel aggregator OYO (Rs 8,430 crore) and supply chain company Delhivery (Rs 7,460 crore), the merchant bankers said.
Several major companies, including Adani Wilmar (₹ 4,500 crore), Emcure Pharmaceuticals (₹ 4,000 crore), Vedant Fashions (₹ 2,500 crore), Paradeep Phosphates (₹ 2,200 crore), Medanta (₹ 2,000 crore) and Ixigo (₹ 1,800 crore), are expected to float their initial share-sales during the period under review.
This time around, Skanray Technologies, Healthium Medtech and Sahajanand Medical Technologies are also likely to come out with their IPOs in order to raise funds for organic growth initiatives and debt payments.
Prateek Singh, founder and CEO of LearnApp.com, said that as technology companies like his expand globally, they will need to raise additional capital. To that end, he says that several startups are turning toward the public markets to raise money. Singh added that anchor investors—those who invested in the company during its early days—have been waiting for an exit opportunity such as an initial public offering to recoup their early commitments.
The Securities and Exchange Board of India has made a series of changes to the primary market regulations in order to curb stock price volatility following initial public offerings.
To prevent companies from paying too large a premium on their initial public offerings and to ensure that most of the shares remain in the hands of investors for long periods, the Securities and Exchange Board of India has imposed a cap on quantum of proceeds that a company can raise for unidentified acquisitions, as well as restrictions on the number of shares that can be offered by selling shareholders and increased lock-up period for shares subscribed by anchor investors.