India’s primary market is poised for a bustling December, with at least 10 companies collectively targeting to raise ₹20,000 crore through initial public offerings (IPOs), according to merchant bankers.
Major names include Vishal Mega Mart, Blackstone-owned International Gemmological Institute (India) Ltd, and Avanse Financial Services.
The diverse offerings span sectors such as retail, healthcare, education, and packaging, offering a mix of fresh equity issues and offers-for-sale (OFS).
Vishal Mega Mart’s ₹8,000 crore IPO will entirely comprise OFS by promoter Samayat Services LLP, according to its draft red herring prospectus. International Gemmological Institute plans a ₹4,000 crore IPO, with ₹1,250 crore as fresh equity and the remaining as OFS by Blackstone's BCP Asia II TopCo Pte Ltd.
Avanse Financial Services is seeking ₹3,500 crore, including ₹1,000 crore of fresh equity to bolster its capital base and ₹2,500 crore as OFS by Warburg Pincus' affiliate Olive Vine Investment Ltd.
Other upcoming IPOs include healthcare player Paras Healthcare, diagnostic chain Suraksha Diagnostic, and packaging firm Mamata Machinery.
Market sentiment and liquidity concerns
The upbeat sentiment follows favourable political outcomes, such as the Maharashtra assembly elections and the UP by-elections, which have boosted investor confidence, said Trivesh D, COO of Tradejini.
However, analysts warn of liquidity strain as over 30 IPOs are expected in the coming months, potentially challenging the market's capacity to absorb them if foreign institutional investors continue withdrawing funds.
Saurabh Patwa, Head of Research at Quest Investment Advisors, noted that the record-breaking ₹1.3 lakh crore raised this year—up from ₹49,436 crore in 2023—has heightened market activity. Yet, balancing this enthusiasm with pricing discipline remains key, as some recent IPOs have struggled in secondary markets.
Post-COVID surge in gains
Retail investors have reaped substantial benefits from IPOs launched between FY21 and FY25, with average listing gains of 27%, surging to 105% as of October 2024, according to data.
The resurgence in IPO activity underscores the primary market's pivotal role in offering companies avenues to retire debt, expand, and meet working capital needs while providing attractive returns to investors. However, the challenge will be sustaining this momentum amid global economic uncertainties.
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