More than making up for the muted first few months, the primary market has been one of the shining lights in the investment arena this year with a bumper rush of public offers and healthy listing gains.
Six IPOs have turned multibaggers in Samvat 2079 with the highest return of over 300% by Kaynes Technology. The other offers which have delivered over 100% returns till date include Plaza Wires, Cyient DL, Global Health, Senco Gold and Utkarsh Small Finance Bank.
While Plaza Wires is up about 163% from its offer price, Cyient DLM and Global Health are each trading 140% higher.
Other notable mentions are the ideaForge and Netweb Technologies IPOs, whose shares doubled investors wealth on listing day. However, enhanced market scrutiny meant that the stocks came under selling pressure post listing.
While Netweb is currently trading 59% above offer price, ideaforge suffered heavy losses after the debut to be sitting with just 17% gains.
Excluding the multibaggers, others were not too far behind in keeping investors happy. Out of the 55 issues that hit the Street this Samvat, there is about 90% strike rate with 49 of them currently trading above the offer price.
Only six IPOs — Uniparts India, Inox Green, Yatra Online, IRM Energy, Updater Services and Elin Electronics — have suffered the wrath of markets. Ein Electronics is the worst of the lot with the current market price 30% below the issue price.
The strong show of new entrants is even sweeter for investors when they had to endure mixed signals in the secondary market from some of the big boys due to various factors including high interest rates, geopolitical tensions etc.,
The flurry of issues that we have seen this Samvat was also because of the lag that occured in 2022, when many companies paused their listing plans post monetary tightening.
“There was a robust pipeline prepared for listing before the high interest rate regime in 2022. The drastic reversal in the macro environment put a plug on that flow. What we are seeing now is a result of a loosening of that plug,” said Utkarsh Sinha of Bexley advisors, a boutique investment bank firm.
“Companies who have received approval wanted to use this opportunity to enter the markets quickly in the anticipation that markets may turn more volatile next year ahead of Lok Sabha Elections,” said Avinash Gorakshakar of Profitmart Securities.
The pipeline
The pipeline of public offers is as strong as what we have seen in the past few months. For instance, about 14 companies have filed their draft papers with capital markets regulator Sebi to launch their issues.
Over 20 companies are sitting with approvals from Sebi, which are still valid and nearly 50 companies are awaiting final observations from the regulator.
Some of the marquee issues that could be expected in the next few months include the Tata Technologies IPO, which could be launched as soon as this month. Other companies like Western Carriers, Fincare SFB, Ebixcash among others are also looking to come up with their IPOs in the next few months.
“The current momentum in IPOs will continue till Diwali, post which the companies would probably monitor market sentiments, which will depend on the state elections scheduled this year and later the big general elections. Ipos from Tata Technologies and Haldirams will be eagerly awaited by investors going ahead,” Gorakshakar added.
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