Indian Firms Raised Rs 6,000 Crore Via 10 IPOs In July-September 2019: EY
Corporate India raised $0.86 billion, about Rs 6,000 crore, via 10 initial public offerings in the July-September quarter of 2019, consultancy EY said in a report Thursday.
Indian firms had raised $0.87 billion via 22 IPOs in the corresponding period last year.
India's IPO activity is expected to gain momentum in the first half of 2020, it added.
Indian stock exchanges are ranked sixth globally in terms of number of IPOs in the third quarter of 2019, according to the EY India ‘IPO Trends Report Q3 2019’.
During the third quarter of 2019, the Bombay Stock Exchange recorded four IPOs as against three in the year-ago period. A similar trend was witnessed in the SME markets too as there were six IPOs in the third quarter of 2019 versus 42 IPOs a year-ago.
According to the EY report, the recent fiscal reforms are likely to instil confidence in the capital markets and is expected to improve market sentiments and liquidity in the economy.
"We expect to see positive momentum around IPOs in the first half of 2020. Companies who were already considering raising money in the public markets will look at the market movement as a positive step to go ahead with their IPOs," said Sandip Khetan, partner and national leader (financial accounting advisory services) at EY India.
“Corporate earnings are likely to be positively impacted owing to the recent fiscal reforms announced and demand in the upcoming festive season,” he said. “Markets have reacted positively to the steps as announced by the Government of India and that is likely to result into re-rating of the Indian markets in near to medium term."
A sector-wise analysis noted that consumer products and retail sector was active with three IPOs, followed by real estate, hospitality and construction and technology with two IPOs each.
Globally, the backlog of high-quality IPOs continues to grow as issuers await more favourable market conditions, pushing IPO activity down across many markets in July-September 2019 compared to the year-ago period.
Overall, 256 IPOs came to the market in July-September 2019 with total proceeds of $40.2 billion, a decrease of 24 percent by volume and 22 percent by proceeds as compared to July-September 2018, the EY report stated.