The primary market activity has seen a sharp rebound in June with as many as eight large IPOs and 30 SME IPOs having hit the road to raise capital.
According to exchange data, eight mainboard IPOs have collectively raised around Rs 17,688 crore, the highest monthly fundraising via IPOs in the last six months. In the SME segment, 30 companies launched IPOs in June, aiming to raise around Rs 1,329 crore, which is a nine-month high.
Analysts, however, are cautious that any large IPO that launches with a subdued listing could dampen sentiment in the secondary market. Large IPOs tend to attract significant investor interest, often diverting liquidity away from secondary markets. While these offerings are typically launched in favourable market conditions, any underperformance or valuation mismatch may quickly sour broader market sentiment, said analysts.
Rajnath Yadav, Senior Analyst at Choice Broking said the surge in activity was due to regulatory timelines imposed by Sebi, prompting companies to expedite listings to avoid re-filing amid market uncertainty. He added that many recent offerings are fresh issues, underlining urgent capital needs that cannot be delayed in search of ideal conditions.
The biggest mainboard IPOs in June included HDB Financial Services (Rs 12,500 crore issue), followed by Kalpataru (Rs 1,590 crore) and Oswal Pumps (Rs 1,387 crore). Other issuers included Ellenbarrie Industrial Gases, Sambhv Steel Tubes, and Arisinfra Solutions.
Earlier in the year, the IPO activity had slowed considerably due to weak sentiment and escalating geopolitical tensions. Several companies, despite securing Sebi approvals, chose to defer their public issues in anticipation of more favourable market dynamics. However, improving macro indicators - including easing inflation and renewed foreign institutional investor (FII) inflows - have modestly lifted sentiment in recent weeks.
Despite the pickup in activity, investor response has remained largely subdued, weighed down by concerns over stretched valuations and muted earnings prospects.
Meanwhile, for SME IPOs, Saurabh Jain, Head - Equity Research - fundamentals at SMC Global Securities, pointed to the notable increase in activity, driven by growing confidence among smaller businesses in the economic along with rising market momentum.
Among the largest SME IPOs by issue size were Safe Enterprises Retail Fixtures (Rs161 crore), Pushpa Jewellers (Rs94 crore), Monolithisch India (Rs82 crore), Neetu Yoshi (Rs74 crore), Patil Automation (Rs66 crore), Sacheerome Ltd (Rs58 crore), Cedaar Textile Ltd (Rs58 crore), and Influx Healthtech Ltd (Rs56 crore), among others.
Looking ahead, experts warn that geopolitical risks and lukewarm listing may dampen the momentum. With several IPOs in the pipeline, the market remains in a wait-and-watch mode, closely tracking both domestic and global cues.
Indian equities experienced sharp volatility in May and June, initially triggered by India-Pakistan tensions and later by the Israel-Iran conflict. With those events now de-escalated, focus has shifted to valuation concerns. Analysts note that several sectors appear overvalued, with limited earnings visibility to justify current price levels. Although domestic institutional investors (DIIs) have continued to support both primary and secondary markets, persistent FII outflows have kept broader sentiment under pressure.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
