Indian IPOs are moving forward despite the stock market sell-off. September brought a series of records: according to primedatabase.com, 34 companies raised over 393 billion rupees ($4.1 billion) through initial offerings, and 46 companies submitted prospectus projects for mainboard IPOs.
Global funds, according to National Securities Depository Ltd., have invested nearly 545 billion rupees in the primary market since the beginning of the year, while about 3 trillion rupees worth of shares were sold in the secondary market – the market is heading towards the longest series of weekly declines in nearly 25 years. The divergence shows that investors are becoming more selective. Concerns about valuations and profits are weighing on stocks, but attractively priced new offerings and a growing pool of domestic capital are allowing companies to raise funds even in a challenging market.
"The excitement reflects the growing interest of companies in the primary market, fueled by strong demand for recent IPOs and healthy first-day trading growth," said Pranav Haldea, managing director of Prime Database Group. "The consistently high subscription levels have given issuers more confidence to move forward." Activity has accelerated after a subdued start to the year – largely thanks to major IPOs from NSE, SBI Funds Management, and Manipal Health Enterprises, which together raised about $4.3 billion.