Investor interest in initial public offerings (IPOs) has surged in recent months, with a total of twenty offerings hitting the market since December and raising over ₹27,000 crore. Despite the volatility in the secondary market, which has seen the Nifty decline by 4.3 per cent, seven of these IPOs have been oversubscribed by over 100 times, indicating strong demand.
Institutional and wealthy investors have shown keen interest in most of these IPOs, with robust retail participation in several cases. This marks a stark contrast to the lackluster response seen in the previous months, when many offerings struggled to attract investors.
According to experts, the buoyancy in the IPO market can be attributed to a combination of factors, including the resilience of the market, continued domestic inflows, and the leading role played by mutual funds in price discovery. Foreign portfolio investors (FPIs) have also remained active in IPOs, despite being net sellers in the secondary market.
While the recent IPOs have mostly been smaller in size, the market is expected to see more issuances once the upcoming Union Budget and policy uncertainties in the US are resolved. In total, 35 companies have regulatory approval for an IPO, while 71 are awaiting a nod, signaling a potential total fundraising of ₹1.78 lakh crore.
Looking ahead, industry experts remain optimistic about the IPO market’s growth prospects, citing strong subscription trends and ample opportunities for investors and issuers. The momentum in IPOs has been building since the landmark year of 2024, when over 90 companies raised ₹1.62 lakh crore through IPOs, more than triple the amount raised in the previous year.
Overall, the IPO market continues to attract investor interest despite market fluctuations, pointing to a positive outlook for the months ahead.
