EY says, As we continue to see strong participation from both domestic and international investors, India is cementing its position as a preferred destination for companies seeking to go public.
MUMBAI, Oct 29 (The CONNECT) – India’s dominance in the global IPO landscape is evident with a 36% share of total listings, significantly ahead of the United States at 13%, an EY India study shows.
The market’s stellar performance is further demonstrated by IPO returns of 65.3% year-to-date, substantially outperforming the BSE Sensex’s 14.9% return.
EY India, a leading global professional services organization, has released its Q3 2024 IPO Trends report, highlighting an unprecedented surge in India’s Initial Public Offering (IPO) market. The report reveals that Indian stock exchanges have achieved their highest quarterly listings in two decades, reinforcing their position as the global leader in IPO activity.
The third quarter of 2024 demonstrated exceptional growth across both main and SME markets. The main market recorded 27 IPOs, a 29% increase from 21 IPOs in Q3 2023, while raising US$ 4,285 million – a remarkable 142% increase from US$ 1,770 million in the same period last year. The SME segment maintained strong momentum with 84 IPOs, raising US$ 398 million.
Notable IPOs of the quarter included Bajaj Housing Finance (US$ 781.16 million), Ola Electric Mobility (US$ 732.25 million), and First Cry (US$ 499.45 million). Consumer Retail Products, Diversified Industrial Products, Real Estate, Hospitality and Construction sectors continue to lead IPO activity across main and SME markets.
“The remarkable momentum in India’s IPO market reflects the increasing maturity of our capital markets and growing investor confidence,” Prashant Singhal, India Markets Leader, EY India said.
Team Ola Electric at the IPO listing
The favourable macro environment has created strong tailwinds for IPO activity, with interest rates expected to moderate to 6.2% by 2025 and inflation projected to ease to 4.5%. The strong performance of mid- and small-cap stocks in the secondary market has encouraged more unlisted companies to pursue public listings, with 68 companies filing their Draft Red Herring Prospectus (DRHPs) in Q3 2024 alone.(Source: www.Sebi.gov.in Home | Filings | Public Issues |Draft Offer Documents filed with SE)
“As we continue to see strong participation from both domestic and international investors, India is cementing its position as a preferred destination for companies seeking to go public,” Singhal said.
In the third quarter of 2024, the Indian main market saw 27 IPOs, compared to 13 in the last quarter. The proceeds raised through the main markets in Q3 2024 were US$ 4,285 million, compared to US$ 1,992 million in Q2 2024. This represents an increase of 115% in proceeds raised with 108% increase in the number of deals. Additionally, the SME segment raised US$ 398 million via 84 IPOs during Q3 2024 and corresponding figures for Q2 2023 were US$ 208 million via 60 IPOs.
Adarsh Ranka, Partner and Financial Accounting Advisory Services Leader, with an Indian member firm of EY Global, added: “India leads the global IPO activity in 2024, driven by strong market conditions and economic growth. The momentum is set to continue with a positive outlook driven by deep liquidity, domestic investment flows.”
Looking ahead, the IPO landscape appears increasingly promising with several major companies, including Hyundai Motor India and Swiggy, receiving listing approvals. This surge in filings, coupled with robust secondary market performance, indicates sustained momentum in India’s IPO market.
