IPOs Worth Over Rs 31,000 Crore In The Pipeline

Initial public offerings planning to raise more than Rs 31,000 crore are in the pipeline.

As many as 27 IPOs are expected to hit the primary market soon, according to data compiled by Prime Database based on approvals granted by the market regulator.

Tata Technologies, ASK Automotive, Protean eGov Technologies, ESAF Small Finance Bank, Flair Writing Industries, Fedbank Financial Services and Park Hotels are among the companies that are expected to hit the primary market.

Companies have time to come out with the public issue within a year after receiving the regulatory approval. The last half of the fiscal looks promising for the primary market with a robust IPO pipeline, according to Mahavir Lunawat, chairperson of the Association of Investment Bankers of India.

About 30 companies have got the Securities and Exchange Board of India's approval so far this fiscal for IPOs worth Rs 40,740 crore, while 38 with IPO size of Rs 43,659 crore still await approval, he said.

In October, 16 draft-red herring prospectuses were filed with the market regulator.

There was a decline in IPO activities in 2022, which is expected to resurrect in 2023, Lunawat said.

Though the secondary market has been subdued and many stocks have corrected, a significant momentum is expected in the IPO market over the coming months.

"We are not seeing any mega IPOs of Rs 50,000 crore or above, which could have (an) impact on primary or secondary market," Prashant Singhal, partner at EY India, said. "Most of them are of about Rs 5,000 crore, rest of them under Rs 1,000 crore."

"With the IPO activity and demand, the Indian market still looks attractive," Singhal said.

Even as the secondary market declined amid global uncertainties in the past week, the impact is not much on the primary market. However, one should look at the valuations and size, according to bankers with knowledge of the matter who spoke on the condition of anonymity.

The valuations are not driven by market demand but are driven by the intrinsic value of the company, Singhal said. "The issue size is driven by the market demand."

The pre-IPO market activity is picking up, but it is not the same as what was seen a few years ago when there was an IPO boom. "Many investors have not seen the kind of upside expected so there is not a market frenzy situation," Singhal said.