FY24 proved to be a very special year for IPOs and the primary market with over 75 new issues, marking the highest count in two years. Propelled by strong demand for equities, particularly from an increasing number of domestic investors, this upsurge set the stage for hectic activity across the primary market.
Equity fundraising through IPOs saw a notable surge of 20% in FY24, with a total of 75 firms raising Rs 61,915 crore through main board IPOs during this period. This marked a significant increase from the Rs 52,116 crore raised by 37 IPOs in FY23.
Several highly anticipated IPOs, such as Tata Technologies, IREDA, JSW Infra and Cello World, Mankind Pharma among others, made their eagerly awaited debut. These IPOs garnered substantial subscriptions and recorded sterling gains on listing day, reflecting investor confidence in the offerings.
The top IPOs in FY24
Out of the 75 IPOs launched, a staggering 54 IPOs were subscribed more than 10 times, with 22 of them seeing subscriptions exceeding 50 times. The average number of retail applications saw a significant surge to 13 lakh, marking a substantial increase from around 6 lakh in the previous fiscal year.
The Tata Technologies IPO emerged as a top choice among retail investors, drawing the highest number of retail applications totaling 52 lakh. Following closely behind were DOMS Industries with 41 lakh applications and INOX India with 37 lakh bids.
Post-listing, several IPOs demonstrated robust financial performances, with IREDA leading the pack with over 4x returns over the issue price, showcasing its pivotal role in driving the renewable energy boom in the country through financing.
Following closely behind were Signature Global, up 244%, and Netweb Technologies, up 200%. Additionally, Cyient DLM witnessed a 160% surge, while Motisons Jewellers rallied over 150%. Other IPOs such as Azad Engineering and Senco Gold also delivered multibagger returns.
Out of the 75 IPOs, 48 yielded returns exceeding 10%. Notably, Vibhor Steel achieved the most significant day-one pop, soaring by 193%, closely followed by BLS E-Services with a remarkable 175% increase, and Tata Technologies with an impressive 163% surge.
In FY24, the market regulator Securities and Exchange Board of India (SEBI) received offer documents from a total of 96 companies, indicating a rise from the 75 companies in the preceding financial year.
Experts on IPOs and primary market outlook for FY25
“We continue to expect continuance of traction in primary market wherein promoters as well as investment bankers and Investors are equity keen to capitalize on the mood of the overall market ahead of the stronger general election results and fundamentally good businesses are coming to raise money with decent valuations along with robust business models giving investors a healthy room for listing gains which is keeping market trend intact,” said Prashanth Tapse, Sr VP research analyst at Mehta equities.
Tapse also added that when compared to FY24, FY25 may also see a similar trend with 100+ companies expected to raise funds for growth as well as via offer for sale and the worth can be anywhere near Rs 1 lakh crore via IPOs. A few big names in the pipeline are like OLA Electric Mobility, OYO, TATAPLAY, Waaree Energies, NSDL, Go Digit General Insurance, Joyalukkas India, Aadhar Housing Finance are ready to tap the markets in next one or two quarters.
Commenting on the same Deepak Jasani, Head of Retail Research at HDFC Securities said that FY25 could also be good for the IPO markets as long as we do not see a sharp correction in markets without a quick recovery. However, the extent of oversubscription could be lower than that in FY24 and the listing premiums could also rationalize to saner levels.
