The Indian primary markets clocked a sharp uptick in the initial public offering (IPO) activity in August, media reports said. The reports said that the maiden listings hit their peak in the month in more than two years.
According to a report by Moneycontrol, 10 firms together raised Rs 17,047 crore collectively in the month. This marked the largest fundraising conducted in a month since May 2022. From the total amount raised, nearly 57 per cent of the funds or Rs 9,715 crore came from fresh issue capital.
About Rs 7,333 crore in the overall funds came from the offer-for-sale (OFS) involved in these issues. In 2024 so far, the report noted that 56 public listings have together raised Rs 65,000 crore, against a little over Rs 15,051 crore raised from 20 IPOs in the first eight months of 2023.
Meanwhile, there has been a sharp uptick in interested firms planning to launch their maiden offers. In August, 25 companies submitted their draft red herring prospectuses (DRHPs) with the Securities and Exchange Board of India (SEBI). Meanwhile, in 2024, 92 firms filed their draft papers with the capital markets regulator. This number was the highest seen since 2021, when 120 companies submitted their IPO papers.
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This increase in interest for IPOs is being driven by the high valuations in the secondary market. Further, strong returns on the listing day seen in recent IPOs has helped bring in investors to the stock market. This boost in the primary market has been led by a robust economic growth and consistent strong earnings reported by the corporates.
Notably, the market has seen some impressive IPOs recently with peak subscription levels. These include Premier Energies which received 75 times the bids, while ECOS India Mobility & Hospitality was subscribed 65 times. Unicommerce eSolutions was subscribed 168.35 times, whereas Saraswati Saree Depot received subscriptions 108 times.