While in 2021, 63 companies raised 1.18 lakh crore through IPO.
Of the 38 IPOs listed so far, 17 have returned more than 10 percent.
NEW DELHI: 40 Indian corporates have raised Rs. 59,412 crore was raised, compared to the Rs raised by 63 IPOs in 2021. 1,18,723 crore (an all-time high), half of that, according to Prime Database, India’s leading database on the primary capital market.
According to PRIME Database Group Managing Director Pranav Haldia, Rs 20,557 crore or 35 per cent of the amount collected in 2022 was collected by LIC alone.
Overall public equity fund raising also fell by 55 per cent to Rs. 90,995 crore which in 2021 was Rs. 2,02,048 crores. The largest IPO in 2022, which was also the largest Indian IPO ever, was that of Life Insurance Corporation of India. This was followed by Delhivery (Rs 5,235 crore) and Adani Wilmar (Rs 3,600 crore). Average deal size is Rs. 1,485 crore was higher.
According to Haldia, 17 out of 40 IPOs i.e. almost half of the IPOs came in the last two months of the year, indicating the volatile conditions prevailing during most of the year which are not conducive to IPO activity.
Only 1 out of 40 IPOs (Delhiwari) was from a New Age Technology Company (NATC) (compared to 7 NATC IPOs that raised Rs 42,826 crore in 2021) pointing to a slowdown in IPOs in the sector. In 2021, 7 new age technology companies came up with IPO. This year the number was only one.
According to Prime Database, the overall response from the public was moderate. Of the 38 IPOs for which data is currently available, 12 IPOs received a mega response of more than 10 times (of which 2 IPOs more than 50 times) while 7 IPOs were oversubscribed more than 3 times. The remaining 19 IPOs were oversubscribed 1 to 3 times. The new HNI segment (Rs 2-10 lakh) saw an encouraging response with 11 IPOs receiving more than 10 times the response from this segment.
The response of retail investors was also modest compared to 2022. The average number of applications from retail declined to just 5.92 lakh as compared to 14.25 lakh in 2021 and 12.77 lakh in 2020. The highest number of applications from retail was received by LIC (32.76 lakh), followed by Harsh Engineers (23.86 lakh) and second. Adani Wilmar (18.96 lakhs).
The amount of shares applied for by retail by value (Rs 46,437 crore) was 22 per cent lower than the total IPO raising (compared to a higher 42 per cent in 2021) indicating a lower level of enthusiasm from retail during the period. However, the total allocation for retail is Rs. 16,837 crore which was 28 percent of the total IPO raising (up from 20 percent in 2021).
According to Haldia, the IPO response was further muted due to moderate listing performance. The average listing gain (based on closing price on the date of listing) declined to 10 percent, compared to 32.19 percent in 2021 and 43.82 percent in 2020.
Of the 38 IPOs listed so far, 17 have returned more than 10 percent. 23 out of 38 IPOs are trading above the issue price (closing price on December 30, 2022).