IPO fundraising drops 26%, yet average listing gains are up by 29%

Despite a 69% increase in overall public equity fundraising during the first half of 2023-2024, funding for initial public offerings (IPOs) has seen a decline in the same period.

According to primedatabase.com, India's premier database on the primary capital market, 31 Indian corporations raised Rs 26,300 crore through main board IPOs in the first half of 2023-24. This is 26% lower than the Rs 35,456 crore raised by 14 IPOs in the same period in 2022-23. However, when excluding the mega LIC IPO from the previous year, IPO mobilization witnessed a substantial 76% increase compared to last year.

Overall public equity fundraising surged from Rs 43,694 crore in the first half of 2022-23 to Rs 73,747 crore.

The largest IPO in the first half of 2023-24 was from Mankind Pharma (Rs 4,326 crore), followed by JSW Infrastructure (Rs 2,800 crore) and RR Kabel (Rs 1,964 crore). On the other hand, the smallest IPO came from Plaza Wires, raising just Rs 67 crore, with an average deal size of Rs 848 crore.

Out of the 31 IPOs, 21 were launched in the months of August and September.

Pranav Haldea, Managing Director of PRIME Database Group, commented, "While we have seen companies from multiple sectors tapping the IPO market in the last six months, one key sector which was missing was BFSI, with just Rs 1,525 crore (or 6 per cent) being raised by companies from this sector (in comparison to 61 per cent in the same period last year)." Notably, only 1 out of the 31 IPOs (Yatra) came from a new-age technology company (NATC), indicating a slowdown in IPOs from this sector.