‘2025’ could prove to be another record breaking year for IPOs in India
New Delhi| According to a latest report, Indian equity markets may see another record-breaking year for initial public offerings (IPOs) due to strong fundamentals and a resilient economy. Fundraising activities have been widespread in all sectors in the country so far.
Domestic investment provided flexibility amid geopolitical risks and market fluctuations, Kotak Investment Banking reported. With more than 30 deals worth $500 million last year, deals in individual products continue to grow in size, according to the investment bank.
Multinational companies (MNCs) prefer India as a listing destination by listing their subsidiaries for the first time in the Indian stock exchanges. At least 91 companies publicly raised about Rs 1.60 lakh crore last year.
Overall, firms raised more than Rs 3.73 lakh crore from the equity market last year, including IPOs, follow-on offers and Qualified Institutional Placements (QIPs), according to the report. Following Hyundai’s mega $3.3 billion IPO last year, LG Electronics is now eyeing India’s market potential with plans for a $1.3 billion IPO.
LG Electronics CEO Cho Ju-wan has said that due to immense business potential in the Indian market, the company has decided to launch an IPO in the country. The South Korean company filed a draft with the Indian stock exchange operator for the IPO of its Indian unit LG Electronics India Limited in early December.
The offer, proposed in April or May, is expected to raise up to 2 trillion won ($1.3 billion). Indian markets remained volatile last year, with Nifty crossing 26,250 and BSE Sensex crossing 85,900 in September and both indexes gained around 21 per cent in the first nine months (January-September) of calendar year 2024. According to the report, more than 90 companies have already filed their draft Herring Red Prospectus (DRHP) with market regulator SEBI.
According to Kotak Securities, India’s economic condition remains good, including solid growth, BoP (currency) outlook and managed fiscal and inflation (except recent surges) outlook. “On the other hand, banks’ net interest margins (NIMs) and credit costs surprised positively, while IT services sector revenues showed a better-than-expected gradual improvement”, the report said.
