Seven SMEs file draft papers in 2016 to launch IPOs

To tap the upbeat investor sentiments, as many as seven small and medium enterprises (SMEs) have filed draft papers to float their initial public offerings this year. The shares will be listed on the SME platforms of the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE). Since the beginning of 2016, seven companies have filed draft documents to collectively mop up about Rs 34 crore through their IPOs, according to an analysis.

Four firms - Sysco Industries, Kranti Industries, Raghav Ramming Mass and AGI Hospitalities - filed papers to launch their IPOs on BSE's SME platform, while Globe International Carriers, HEC Infra Projects and Artemis Electricals plan to list on NSE Emerge. These companies are from sectors such as logistics services, automotive components, infrastructure and hospitality, among others. According to market experts, increasing number of firms coming on SME exchanges send positive signals and lend a lot of confidence to SME capital markets.

"Listing will help them enter capital markets and finally to graduate on to mainboard," Hem Securities Director Gaurav Jain said. "We are looking forward to a number of IPOs from different cities in the next 6-8 months, which will join the club of listed companies. It will send a positive signal to other SMEs which are keen to tap the capital markets," he added.

In 2015, 43 companies were listed to garner about Rs 327 crore from SME platforms. BSE and the National Stock Exchange (NSE) had launched SME platforms in March 2012, becoming the only two bourses to offer such a segment in the country. Since then, several companies have got listed on them and some have even shifted to the mainboard.

The platform provides opportunity to SME entrepreneurs to raise equity capital for growth and expansion. It also provides immense opportunity for investors to identify and invest in good SMEs at an early stage.