Is it a bullish boom or a bearish rebound?

2023 marks the return of TATA Group shares to the primary market through the Tata Tech IPO after nearly two decades. And it was a strong comeback as the stock was listed at Rs. 1200. 500 on NSE against an issue price of Rs.

Tata Tech broke records and its IPO was oversubscribed 69.43 times on the last day with over 73.6 lakh applicants investing around Rs. $157 million. Additionally, the IPO doubled investors’ wealth by listing at a 140% premium.

Do you remember those old items you dreamed of purchasing, such as iconic DOMS products and items that hold countless memories like Sello World? Well, today, instead of buying their products, I invest in their IPO.

We’re sure a lot of ’90s kids will relate to this!

And that’s not all! The biggest IPOs (estimated Be prepared for the price). . 200 billion rupees), PharmEasy (Rs 62 million), Mobikwik (Rs 10 million), etc.

After the IPO market was quiet over the past two years due to the war in Ukraine and the inflation crisis, it appears to be preparing for a major comeback.

What is an IPO?

An initial public offering (IPO) is when a private company sells stock to the public for the first time to raise equity capital from investors without raising new funds from private investors. It may be a new company, a young company, or an old company that decides to list on an exchange, making it a public company.

So, an IPO basically turns a private company into a public company, giving the general public an opportunity to invest and earn a return on that investment.

Is India experiencing an IPO boom? What does this mean?

India’s IPO market has rebounded strongly this year to become the global leader in the number of IPOs so far in 2023, attracting investors to capitalize on renewed interest in public offerings on Dalal Street.

Despite global economic uncertainty, Indian stock markets have seen a notable increase in IPO activity in recent years, demonstrating strong confidence in the Indian economy.

Increased subscriptions in IPOs also indicate that company owners or promoters are seeking larger capital to support their growth plans and that investors are reacting positively to such opportunities.

An important factor driving this surge in IPOs is the active participation of retail investors. This often leads to oversubscription, such as the Tata Tech IPO, which indicates growing interest in the stock among retail investors and reflects business owners’ confidence in its future success. The company and its confidence in the ability of the Indian market to support its growth objectives.

This trend is expected to continue until the second half of 2024.

What do the numbers tell us about IPOs?

Motherboard IPOs have had an impressive run over the past three years. 2023 will be a record year for the highest number of IPOs in the past decade. This surge is driven by SME exchange listings, while mainboard offerings (NSE and BSE listings) are the second highest in the last 10 years.

Source: Prime Database and Bloomberg
The 2023 data is for IPOs launched through November 28.

Redseer predicts that there will be around 40 IPO-ready startups in India by March 2025. However, it is important to remember that not all IPOs are successful and India has had a number of large-scale IPO failures in the last two years.

Written by Shivani Singh

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