India's Initial Public Offering (IPO) market demonstrated remarkable resilience in September, successfully raising approximately ₹39,380 crore ($4.1 billion) from 34 companies. This surge in fundraising unfolded even as the broader stock market experienced a notable sell-off, marking a period of sustained activity for new listings.
Domestic Liquidity Fuels IPO Momentum
The National Stock Exchange of India (NSE) played a pivotal role in September's fundraising success, with its ₹22,562 crore IPO accounting for over 57% of the total capital raised. Experts attribute this robust performance to a combination of factors, including stronger domestic liquidity, consistent institutional demand, improved market access, and the release of pent-up IPO supply following a quieter first half of the year.
Ajit Mishra, SVP of Research at Religare Broking, highlighted that valuation discipline and business quality are increasingly important for investors, with a strong focus on earnings visibility, operating cash flow, and return ratios. Despite concerns over valuations weighing on listed stocks, attractively priced new listings and a growing pool of domestic capital have enabled companies to raise funds even in a challenging market environment.
Investor Confidence and Future Outlook
Ratiraj Tibrewal, CEO at Choice Capital, emphasized that domestic liquidity has been a primary driver, with steady mutual fund inflows maintaining strong demand. Foreign institutions also participated through anchor books, bypassing the more volatile secondary market. However, Tibrewal cautioned that valuations have become demanding in certain segments, particularly for issues heavily reliant on Offers for Sale (OFS).
Notable mega IPOs during the month included Elevate Campuses (₹2,100 crore), Rentomojo (₹1,256 crore), Moneyview (₹1,092 crore), Kanohar Electricals (₹1,056 crore), and Hero Motors (₹1,000 crore). Several other companies, such as Karamtara Engineering and Manipal Payment & Identity Solutions, also raised over ₹500 crore.
Aakash Bansal, Co-Founder & CEO of MIDASX, noted that investors are increasingly evaluating businesses based on their fundamentals and long-term opportunities, fostering a supportive environment for companies with credible growth plans to raise capital.
Navigating the IPO Landscape
Looking ahead, the final quarter of the year is expected to remain busy for the Indian IPO market. Major offerings in the pipeline include Jio Platforms’ proposed share sale of around ₹40,000 crore, along with anticipated big-ticket IPOs from Avaada Electro and Advanta Enterprises. Currently, approximately 144 companies have received approval to launch IPOs, with another 80 awaiting clearance.
Piyush Jhunjhunwala, Founder and CEO at Stockify, advised investors to focus on business fundamentals rather than just subscription buzz. He stressed the importance of examining revenue generation, profitability, cash flow, debt levels, and comparing valuations with other listed companies in the same industry.
While the pipeline appears robust, experts like Mishra caution that the actual pace of new issues will be influenced by secondary-market conditions, investor liquidity, absorption capacity, valuation expectations, regulatory clearances, and the readiness of issuers.