Investors chase hot IPO stocks, give companies Rs 84,357 cr booster shot!

Indian companies garnered Rs 84,357 crore through initial share sales in 2017-18, registering a nearly three-fold jump compared to the preceding fiscal, says a report. According to the study by PRIME Database, the amount raised by firms through the initial public offer (IPO) route stood at Rs 29,050 crore during 2016-17. "2017-18 was the best year ever for the IPO market by far, the previous high being in 2007-08 when Rs 41,323 crore was raised, less than half of the amount raised in 2017-18," said Pranav Haldea, Managing Director, PRIME Database.

While there were 45 main-board IPOs during 2017-18 collectively raising Rs 82,109 crore, the preceding fiscal saw 25 of them together garnering Rs 28,225 crore. As per the report, the largest initial share sale was from state-owned General Insurance Corporation of India for Rs 11,257 crore and the average deal size stood at Rs 1,825 crore. Among the main-board IPOs, the issue of Salasar Techno Engineering received the best response with a subscription of 270 times, followed by Astron Paper & Board Mill at 241 times and Apollo Micro Systems at 176 times.

During 2017-18, there were 155 SME IPOs raising Rs 2,247 crore compared to 80 in the previous fiscal garnering Rs 825 crore. The largest SME IPO in 2017-18 was from East India Securities (worth Rs 88 crore), the report said.
"2018-19 is likely to see more volatility in the secondary market which shall affect fund raising plans of companies as well.

"While there are 12 companies holding Sebi approval wanting to raise over Rs 10,395 crore and another 18 companies wanting to raise about Rs 29,282 crore awaiting Sebi approval, as we have seen in the past, this pipeline may quickly vanish if the volatility and negative sentiment continues," Haldea added.