Indian firms raised ₹1.6L crore through IPOs in 2024
What's the story
Indian companies have set a new record by raising a staggering ₹1.6 lakh crore through Initial Public Offerings (IPOs) in 2024.
This achievement comes on the back of economic growth, favorable market conditions, and enhancements in the regulatory framework.
The success of these IPOs reflects not only the confidence of issuers but also investors' enthusiasm to capitalize on listing-day profits or support businesses with robust long-term growth prospects.
Record-breaking IPO
Hyundai Motor India's IPO was a historical milestone
Hyundai Motor India's ₹27,870 crore IPO was one of the biggest highlights of 2024. It was one of the largest ever in the country's history.
All kinds of companies - large, mid, and small - tapped the IPO route this year. The average issue size witnessed a massive jump from ₹867 crore in 2023 to over ₹1,700 crore in 2024.
Market dynamics
Factors contributing to India's IPO boom
The IPO market's vibrancy was especially evident in December, with at least 15 launches.
V Prashant Rao of Anand Rathi Advisors attributed the momentum to "rising retail participation, strong domestic inflows and active participation by FPIs (even though they have been net sellers in the secondary market), private capex increase and the government's strategic focus on infrastructure and key sectors."
Future outlook
Market analysts predict brighter prospects for 2025
Market analysts are hopeful the fundraising momentum will continue into the new year, possibly exceeding 2024's record numbers.
Munish Aggarwal, Managing Director and Head of Equity Capital Markets at Equirus said, "Based on the 75 IPO documents, which are at various stages of approval/marketing and the deal pipelines, we expect issuance activity in 2025 to cross ₹2.5 lakh crore."
The next year is anticipated to see big offerings from HDB Financial Services, LG Electronics India, and Hexaware Technologies.
SME growth
SME sector also experiences record IPO activity
The SME sector also saw a boom in IPOs, with a record 238 small and medium enterprises raising ₹8,700 crore. This is almost double the ₹4,686 crore raised in 2023.
To shield retail investors from higher risks of these offerings, SEBI has introduced stricter regulatory measures such as profitability requirements and a cap on the offer-for-sale (OFS) component.