2017: Robust year for IPOs for Indian primary markets

Priya Kansara Mumbai | Updated on January 08, 2018

36 main board IPOs raised a cumulative amount of Rs 67,147 crore compared with 26 companies that raised Rs 26,494 crore in 2016.   -  PTI

Outlook for 2018 even more promising: Prime Database

Year 2017 was an iconic one for Indian primary markets, which witnessed record capital raising of Rs 1.6 lakh crore, 3.6 times the amount raised in 2016, according to Prime Database. Out of the total capital raising, 53 per cent was by way of fresh issue of shares.

The all-time high mobilisation was driven by initial public offers and qualified institutional placements. There were 36 main board IPOs which raised a cumulative amount of Rs 67,147 crore compared with 26 companies that raised Rs 26,494 crore in 2016.

Almost half (17 companies) of the total number of 36 IPOs were backed by private equity or venture capital investors. While offer for sale by these investors formed 15 per cent of the total IPO money raised, those by promoters accounted for 63 per cent of the IPO amount, Prime Database pointed out.

Largest IPO

The largest IPO was by General Insurance Corporation, which raised Rs 11,257 crore. While 17 companies received good subscriptions (over 10 times), 18 companies gave good returns (more than 10 per cent) on listing. 133 SME IPOs, which raised Rs 1,679 crore, was also the highest ever.

Infrastructure investment trusts

2017 has been the first year, which saw the listing of infrastructure investment trusts. Two companies raised Rs 7,283 crore via INVITs. Like IPOs, money raised by 44 companies via QIPs was also the highest-ever at Rs 61,118 crore, which was 13 times the amount raised in 2016. Banks dominated the QIP issue with a share of 63 per cent and the largest was by State Bank of India (25 per cent of the total QIP amount).

2017 was good for government as well as it raised Rs 73,282 crore amid its disinvestment programme through IPOs, OFS, exchange traded funds, block deals, buyback and issue to employees.

Outlook for primary markets

The outlook for primary markets in 2018 looks even more promising, said Pranav Haldea, managing director, Prime Database. While 15 companies holding SEBI approval are looking to raise Rs 12,000 crore, another 10 companies are awaiting SEBI approval to raise Rs 19,000 crore.

Reduction in government holding in 18 listed public sector undertakings to 75 per cent (according to SEBI guidelines) alone can contribute Rs 27,520 crore. Further it has planned to list profit-making unlisted PSUs and identified 34 PSUs for strategic sale.

Published on January 01, 2018

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