The action in primary market will continue in 2024, with over Rs 75,000 crore expected to be raised via IPOs against Rs 49,434 crore in 2023, Pranav Haldea, MD Prime Database, told Moneycontrol on the sidelines of AIBI Annual Convention 2023-24.
Haldea said that the major trigger for both primary and secondary markets this year is the general elections, which is expected to be held between April and May 2024.
“If things go as expected, then a flurry of IPOs may be seen entering the markets post-election. However, IPO Street may take a pause before elections,” said Haldea.
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In December 2023, Narendra Modi-led Bhartiya Janta Party (BJP) swept three out of four state elections, winning Madhya Pradesh, Rajasthan and Chhattisgarh, adding two more states to its double engine team of governments.
“Result reinforces consensus expectations of a Modi win in the 2024 national poll. Boost to investor sentiment should augur well for domestic cyclical sectors like banks, industrial, power, property and midcaps,” global brokerage Jefferies had said post the results announcement.
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Haldea also expects the most awaited National Securities Depository Limited’s (NSDL) IPO to hit the market in 2024. The country's oldest depository services firm is likely to raise Rs 3,000 crore.
Haldea said more new-age technology companies (NATC) and manufacturing firms may go public in 2024. He further expects the average IPO size to increase owing to more large firms coming with public issues this year compared to 2023.
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The overall capital market activity in 2023 ($38 billion) was back near the peak of CY20 ($39 billion). There was moderation in volumes with a reduction in average IPO size. The average size in CY22 was $190 million which came down to 109.5 million in CY23.
Three NATCs namely OYO, Digit Insurance and First Cry, are looking to raise roughly Rs 16,000 crore, according to Prime Database. Over 27 companies have received SEBI approval so far to raise a combined amount of Rs 28,500 crore and around 36 companies awaiting approval to raise a total of Rs 40,500 crore.
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