Twelve IPOs set to raise over $1 billion next week

Next week, twelve initial public offerings (IPOs)—including four from the main board and eight from small and medium enterprises (SMEs)—are aiming to raise over $1 billion (₹8,600 crore). Among the main board IPOs, the companies vying for investor attention are Bajaj Housing Finance, targeting around ₹6,560 crore, Tolins Tyres (₹230 crore), Kross Ltd (₹500 crore), and P N Gadgil Jewellers (₹1,100 crore). Western Carriers India is also expected to launch an IPO soon, though its exact dates are still pending.

Bajaj Housing Finance, Tolins Tyres, and Kross Ltd will begin their subscription process on September 9 and end on September 11, while P N Gadgil Jewellers will open on September 10 and close on September 12. According to Apurva Sheth, Head of Market Perspectives and Research at SAMCO Securities, the current enthusiasm in India’s primary market is driven by strong investor interest, especially from retail investors seeking attractive listing gains.

The secondary market’s robust performance, with Nifty up by 15.71% this year, is contributing to this trend. Additionally, ample liquidity from both domestic and international institutional investors is further supporting the IPO market. Grey market premiums (GMP) for these IPOs are also rising. Bajaj Housing Finance’s GMP stands at ₹51 per share, 73% above its upper price band of ₹70, while Tolins Tyres GMP is up 12%, and P N Gadgil Jewellers IPO is trading over 37% higher.

For SME IPOs, Gajanand International, Share Samadhan, Shubhshree Biofuels Energy, and Aditya Ultra Steel will open on September 9 and close on September 11. Trafiksol ITS Technologies and SPP Polymer will launch on September 10 and close on September 13, while Innomet Advanced Materials and Excellent Wires & Packaging will open on September 11 and close on September 13. These companies aim to raise between ₹12-45 crore each.

Recent IPOs have seen substantial subscriptions, with main board IPOs in August averaging over 75 times oversubscription, and 2024’s average standing at 66 times. SME IPOs in August averaged 290 times oversubscription, with a year-to-date average of over 259 times. The strong subscription rates are driven by high engagement from retail, institutional, and foreign investors.

Despite foreign investors being net sellers in secondary markets, they have continued to invest in primary markets, contributing ₹12,872 crore in August and around ₹54,883 crore in total for 2024 so far. Analysts observe that many recent IPOs are from high-growth sectors, attracting investors with expectations of strong growth. This trend is anticipated to continue through 2024 and into 2025. Nirav Karkera, Head of Research at Fisdom, suggests that increasing retail participation and renewed interest from foreign institutional investors, influenced by global economic conditions, make the market favorable for upcoming IPOs. The success of recent listings is expected to further boost interest in the next wave of IPOs.

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