India's IPO Boom: A sign of vibrant markets and growing investor confidence
Indian equity market has witnessed an astounding surge in IPO activity, defying global economic uncertainties and underscoring the resilience of the Indian economy.
Post the 2020 Covid crash, Rossari Biotech initiated the wave of IPOs, witnessing overwhelming subscription and listing success. This event paved the way for numerous IPOs, demonstrating the robustness of Indian equity markets and attracting investments from various segments, including fervent participation from HNIs and retail investors.
Over the past three years, the main board IPOs have displayed remarkable strength. In 2021, 63 companies went public, raising Rs 1.2 lakh crore. Despite global market challenges, 2022 witnessed 40 IPOs, accumulating Rs 60,000 crore. As of November in 2023, 48 companies have already gone public, raising more than Rs 45,000 crore.
This IPO surge extends to the SME space as well, with 2023 breaking records with 156 IPOs, raising more than Rs 4,200 crore. The increasing average ticket size in SME IPOs, from Rs 13 crores in 2021 to Rs 18 crore in 2022 and Rs 25 crore in 2023, indicates that promoters are seeking larger capital to fuel their growth ambitions, and investors are responding positively to these opportunities.
The active participation of retail investors has been a key driver of this IPO boom, often resulting in massive oversubscriptions. This reflects a growing appetite for equities among retail investors and a heightened confidence in the Indian economy.
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Notably, almost 50% of IPOs have been primary tranche issuances, signaling that companies are raising fresh capital to expand their businesses or pay off debt. This demonstrates promoters'
