The excitement around initial public offerings (IPOs) continues to grow as the year approaches its end. As many as 27 IPOs are expected to hit the primary market soon, according to data by Prime Database as on October 30, 2023, with three already completed as on November 15, 2023. These include, Protean eGov Technologies, ESAF Small Finance Bank, and Ask Automotives.
Among the IPOs listed till October 2023, Prime Database also reported an average listing gain of 29.44 per cent (based on the closing price on the listing date) compared to 11.56 per cent in the first half of FY2022-23. Of the 28 IPOs listed thus far, 20 returned over 10 per cent.
Trivesh D, chief operating officer (COO) of stock trading platform Tradejini, attributed the thriving performance of Indian IPOs in 2023 to a buoyant secondary market, positive economic sentiments, and distinctive business models of IPO entrants.
“Notably, smaller-sized IPOs have been prevalent in 2023, often below the Rs 1,000 crore mark, thus limiting pre-IPO institutional investment. In turn, this curbs major stakeholders from divesting their shares in the post lock-in periods. The robust performance also stems from a bullish stock market, fear of missing out (FOMO) by retail investor participation, amenable regulatory reforms governing IPO listings, and extensive media hype surrounding IPO,” says Trivesh.
An IPO allows private companies to go public by selling stocks to the general public for the first time, thus offering liquidity to shareholders and boosting visibility and credibility in the market.
Among the upcoming launches, three IPOs have already captured investors’ interest. Here are these three IPOs.
Tata Technologies, which is part of Tata Motors, is set to kick off its highly anticipated IPO on November 22, 2023. It will remain open for subscription till November 24. It’s an offer for sale of 6.08 crore equity shares for cash, with listing scheduled for November 30, 2023.
The Indian Renewable Energy Development Agency’s (IREDA’s) IPO, which is a state-owned entity, opens on November 21, 2023 and will close on November 23. Priced between Rs 30 and Rs 32, it marks the first IPO by a public sector company since Life Insurance Corporation’s (LIC’s) public issue last year. Listing is scheduled for December 1, 2023.
Next in line is FedBank Financial Services, with its IPO featuring a fresh issue of Rs 750 crore and 7.03 crore equity shares by promoters and other shareholders. Under the offer for sale, Federal Bank will offload 16.5 million shares, and True North Fund VI LLP will divest 53.8 million shares. The price band has not been fixed yet.
According to Trivesh, the IPO landscape in 2023 stands in stark contrast to the preceding year, with a shift from FOMO-driven launches to solid fundamental performances, thus reflecting a more stabilized and promising market.