Big IPOs seen making a comeback as stock boom continues
India may soon be followed by larger deals, broadening options for global investors looking to join the nation’s equities frenzy.
Citigroup Inc., the top arranger of equity offerings in India this year, sees four to five IPOs of at least $1 billion each over the next year. At least 10 companies are weighing offerings of more than $100 million, according to data compiled by Bloomberg.
A flurry of small deals has made India one of Asia’s busiest IPO markets this year. Bigger share sales brighten the nation’s chances of attracting global funds as investors rotate money amid a patchy recovery in China. A mix of factors is behind the exuberance — stocks are scaling new heights, economic growth is solid and earnings are beating estimates.
At the start of the year, “we saw a lot of smaller IPOs coming to market, not large ones. What we are seeing is a big shift in this trend with average IPO sizes going up meaningfully,” said Jibi Jacob, the head of equity capital markets for Jefferies in India.
The timing to go public is also influenced by India’s ongoing elections. The poll outcome on June 4 will give a clear picture of political stability and policy continuity, removing any lingering uncertainty for companies.
Potential issuers include e-commerce startup BrainBees Solutions Ltd., which retails baby products under the brand name FirstCry.com, hypermarket operator Vishal Mega Mart, and SoftBank Group Corp.-backed ANI Technologies, which is the operator of ride-hailing app Ola Cabs. Hyundai Motor Co. is also
