FY24 IPO Frenzy: This Fiscal Year Sees Record Public Issues; 5 Stocks Surge Over 150%; SME Portion Soars

The financial year 2024 (FY24) has been nothing short of spectacular for the Indian IPO market, witnessing a surge in offerings and unprecedented enthusiasm among investors. With a record-breaking 75 IPOs hitting the market, coupled with a substantial increase in SME IPO activity, the fiscal year painted a vibrant picture of India's burgeoning capital markets.

FY24 witnessed a flurry of IPO activity, with 75 companies making their debut on the primary market, marking the highest number of issues launched in two years. This surge was fueled by robust demand for equities, driven largely by an increasing number of domestic investors keen on tapping into the potential of the stock market.

Some of the most anticipated IPOs, including Tata Technologies, IREDA, JSW Infra, and Cello World, among others, made waves in the primary markets. These offerings garnered substantial subscriptions and witnessed positive movements on their listing days, signalling strong investor confidence.

Equity fundraising through IPOs also witnessed a remarkable uptick, with a 20% increase compared to the previous fiscal year. A total of Rs 61,915 crore was raised by 75 firms through mainboard IPOs during FY24, reflecting a significant surge from Rs 52,116 crore raised by 37 IPOs in FY23.

Over 50 of the 75 IPOs are currently trading above their issue prices, with an average return of 65%. Notably, five IPOs have soared over 150% from their issue prices, showcasing the potential for substantial gains in the IPO market.

Leading the pack in terms of post-listing performance is IREDA, which has generated over 4x returns over the issue price, underscoring its pivotal role in driving the renewable energy sector forward. Other notable performers include Signature Global, Netweb Technologies, Cyient DLM, and Motisons Jewellers, among others.

However, amidst the success stories, there were also companies that struggled to meet public expectations post-listing. HMA Agro Industries, Credo Brands Marketing, Muthoot Microfin, and Epack Durables were among the notable underperformers, trading below their issue prices.

Mankind Pharma emerged as the largest player in the mainboard IPO segment, raising Rs 4,326 crore, followed closely by JSW Infrastructure with Rs 2,800 crore. Plaza Wires conducted the smallest IPO, securing Rs 71 crore. The average deal size saw a significant reduction from Rs 1,409 crore in FY23 to Rs 815 crore in FY24.

Retail investor participation surged, with the average number of retail applications increasing to 13 lakh, marking a substantial increase from approximately 6 lakh in the previous fiscal year.

FY24 also witnessed a record year for small and medium enterprises (SMEs) in the IPO space. A total of 205 companies collectively raised approximately Rs 6,300 crore through the SME IPO route, representing a significant increase from the previous fiscal year.

Retail investor frenzy was palpable in the SME segment, with subscription numbers soaring to unprecedented levels. Kay Cee Energy and Infra's IPO was subscribed 959 times the offer size, followed by Maxposure with 904.86 times subscription.

The strong IPO trend is expected to continue, with global brokerage house Jefferies noting favourable conditions for multinational companies to contemplate listing in India. The success of startups and the upcoming listings of companies like Hyundai India and Reliance Jio are indicative of the immense potential of India's capital markets.

Overall, FY24 has been a watershed moment for India's IPO market, reflecting the growing confidence of investors and the robustness of the country's economic landscape. As India continues its journey towards becoming a global investment destination, the IPO market is poised for further growth and innovation in the years to come.