IPO performance 2024: 91 public offerings raise Rs 1.59 trillion this year

2024 proved to be a remarkable year for the Indian primary market, led by SME issues. While India saw 91 mainline Initial Public Offerings (IPOs) raising a combined Rs 1,59,676 crore (Rs 1.59 trillion), the small and medium enterprises (SME) segment witnessed 240 IPOs collectively raising Rs 8,753 crore, according to data sourced from Prime Database.

 

According to analysts, IPO market was back with a bang in 2024 as many retail and high net-worth individual (HNI) investors discovered IPOs as another route to generate alpha in their portfolios in 2024.

 

"2024 was a record breaking year for IPOs, especially SME IPOs. SME IPOs had many multibaggers, but with a large number of investors realising the easy money available in IPOs, it became more difficult to get allotments. This, in turn, became like a lottery system, as issues saw record oversubscriptions. Some SME IPOs were oversubscribed a mind-boggling over 2,000 times," said Ambareesh Baliga, an independent market analyst.

 

That apart, strong secondary market performance, favorable market conditions, and improved regulatory frameworks, marked a solid year for Indian equity markets, supporting the IPO euphoria.

 

"This year has been phenomenal for IPOs, no doubt," said G Chokkalingam, founder and head of research at Equinomics Research. "Historically, what happens is that, whenever there is a boom in the secondary market, it percolates down to the primary market," he explained.

 

Notably, the BSE small-cap index has risen 30 per cent in the last year and 27 per cent year-to-date, while the mid-cap index has also gained 28 per cent in the last year and 24 per cent year-to-date. Meanwhile, the benchmark BSE Sensex has risen 8.58 per cent year-to-date, reaching an all-time high of 85,978.25 on September 27, 2024. The NSE Nifty50 followed suit, climbing 9.13 per cent to a record high of 26,277.35 on the same day.

 

Here are the other key highlights of 2024 for primary markets:

 

Hyundai Motor India leads the charge

Among the key highlights, Hyundai Motor India, the Indian arm of South Korean automaker Hyundai Motor, launched the largest IPO in Indian history, raising Rs 27,858.75 crore. Other notable IPOs included Swiggy, which raised Rs 11,327.43 crore. NTPC Green Energy garnered Rs 10,000 crore. Vishal Mega Mart raised Rs 8,000 crore, and Bajaj Housing Finance collected Rs 6,560 crore.

 

"Large IPOs, barring Hyundai, did well," said Baliga, adding, "In the past, the biggest IPOs received lukewarm responses, and most of them struggled to give large immediate gains. However, 2024 saw most of them getting decent responses, and even those that received lukewarm responses performed well on listing, except Hyundai, which was wholly an OFS, and there was a lot of media negativity surrounding the issue."

 

Baliga remained bullish on NTPC Green and Bajaj Housing Finance. However, he stated that he would wait for another one or two quarterly earnings reports from Swiggy before reviewing its performance. Hyundai and Vishal Mega Mart were not on his buying list.

 

Waaree Energies sets a new record

Waaree Energies set a new benchmark in October 2024 by receiving 97.34 lakh applications for its IPO, surpassing the record set by Bajaj Housing Finance in September 2024. Previously, Tata Technologies held the record in 2023.

 

Will the momentum continue in 2025?

The momentum in the IPO market is expected to carry forward into 2025, with 24 companies already receiving approvals from the Securities and Exchange Board of India (Sebi) to launch their IPOs, while another 62 companies have filed Draft Red Herring Prospectuses (DRHPs) and are awaiting clearance. These companies collectively seek to raise around Rs 1,54,363 crore.

 

Baliga believes that it is a great time for company promoters planning an IPO, as funds are easily available. "At the same time, those who are lucky enough to get allotments can add alpha to their portfolios."

 

Most awaited IPOs in 2025

Among the most awaited IPOs in 2025 are National Securities Depository (NSDL), Ecom Express, Shivalik Engineering Industries, LG Electronics India, and Avanse Financial Services. Other highly anticipated offerings include Dr Agarwal's Health Care, Hexaware Technologies, and HDB Financial Services. The upcoming year is set to build on the momentum of 2024, offering significant opportunities for both issuers and investors in the Indian equity market.

 

Chokkalingam, however, remains cautious about 2025 and said he suspects that the bull run may not continue in the IPO market. He further stated that in the last few months, the overall market capitalisation has decreased by almost Rs 42,000 crore. Additionally, perception-driven stocks in the mid-cap space have fallen by 20 to 30 per cent, resulting in significant value variation. Moreover, many IPOs have not performed well post-listing. The regulator has also taken effective measures to ensure the proper use of funds for SME IPOs.

 

"Considering these three developments, I believe 2025 may not be as robust as it was in 2024,"  Chokkalingam said.