IPO cleanup sinks 32 per cent to Rs 35,456 crore in first half of fiscal: report

In the first half of the financial year, only 14 companies sold primary shares on the main board. This is 32% less than the same time last year, when 25 issues raised Rs 51,979 million. number of rupees

But Prime Database says that the IPO portfolio is strong, with 71 issues worth Rs 1.05 trillion approved by Sebi and 43 more worth Rs 70,000 trillion waiting for approval. Ten of these planned issues are from new technology companies that want to raise about Rs 35,000 crore.

Prime Database says that the total amount raised during the first half of the year would have been much lower if LIC hadn’t issued Rs 20,557 crore. This is about 58% of the total amount raised during the first half of the year.

In the first half of the current fiscal year, Rs 35,456 crore was raised through 14 major IPOs, which is 32% less than the Rs 51,979 crore that was raised through 25 IPOs in the same time period of FY22. Pranav Haldea, managing director of Prime Database Group, said in a note on Thursday that Rs 20,557 crore, or 58% of the total, came from the sale of LICs alone. . It also said that the amount of money raised from the public fell by 55%, from Rs 92,191 crore to Rs 41,919 crore.

At Rs 20,557 crore, the LIC issue was the biggest in the country. It was followed by the Delhivery issue (Rs 5,235 crore) and the Rainbow Children’s issue (Rs 5,000 crore) (Rs 1,581 crore). Only one of the 14 IPOs was for a new technology company (Delhivery), which shows that this sector has slowed down since Paytm and a few others had terrible problems. While the overall market response to the IPOs was less than expected, only four of the 14 IPOs had oversubscriptions of more than 10 times, and three had oversubscriptions of more than 3 times. The other seven were one to three times full.

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The number of applications from individual investors also dropped, from an average of 15.56 million in FY22 to an average of 12.49 million in FY21. LIC had the most retail applications (32.76 lakh), followed by Harsha Engineers (23.86 lakh) and Campus Activewear (17.27 lakh).

Also, the value of shares asked for by retail investors (Rs 23,880 crore) dropped by 32%, which shows that retail investors are less interested. The total amount given to retail investors was Rs 9,841 crore, which is only 28% of the total amount raised by the IPO. This is slightly more than the 23% that retail investors got in FY22.

Haldea says that the pair’s quiet performance made the response even smaller. The average profit from listing fell from 32% in FY22 to 12% in FY21. In FY21, it was 42%. Six of the 14 issues gave a 10% return, and Harsha Engineers gave a 47% return. , with Syrma SGS (42%) and Dreamfolks (42%) close behind. As of September 26, 11 of the IPOs are trading above the price at which they were first sold.

In only four cases did a private equity or venture capital investor sell shares in the IPO. The PE/VC investors’ offers to sell, at Rs 3,349 crore, were only 9% of the total IPO amount. The promoters’ offers to sell, at Rs 2,206 crore, were 6%, and the fresh capital was at Rs 8,641 crore.

In the first half of the year, 41 companies sent in their offer documents, while last year, 87 companies did so.

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Haldea thinks that the IPO portfolio is still strong because 71 IPOs worth Rs 1.05 trillion are waiting for Sebi’s approval, and 43 more IPOs worth Rs 70 trillion are also waiting for Sebi’s approval. . Ten of these planned issues are from new technology companies that want to raise about Rs 35,000 crore.

In the first half of the year, 62 SME issues raised a total of Rs 1,078 crore. This is a big increase from the same time last year, when 30 SME issues raised a total of Rs 346 crore.


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