The IPO boom is on and there seems to be no stopping the juggernaut now as it has acquired too much momentum. Investors are extremely positive about all the primary market issues that have been rolled out over the recent months. Sahaj Solar IPO, Ganesh Green Bharat IPO to Effwa Infra IPO have been extremely successful and they have followed in the footsteps of so many others. And there are more on the way including Prizor Viztech IPO, Three M Paper Boards IPO and others.
And the trend is continuing after the general elections put the NDA in charge for the next 5 years, which in itself was a galvanising factor as the markets believe nothing will change for the worse as the old government is still in charge. While that is one reason, there are a number of other, equally important reasons for the IPO subscriptions skyrocketing.
As many as 35 IPOs in the first half of the year (H1CY24) made their debut, and out of these as many as 27 were listed at a premium, according to Capitalmarket data. Over the recent months, the IPO subscriptions were so high that the market watchdog SEBI had to launch a crackdown and it even capped the limit at 90%, thereby disappointing millions of eager investors who have generally been looking at these IPOs as a great opportunity to make listing day, short-term, gains.
Here are 5 reasons why IPO subscriptions are booming:
1. The Indian economy is very strong and it has shown that it is flexible enough to absorb a lot of blows and yet recover quickly. The macro environment is extremely robust, and that is encouraging investors to participate in the IPO boom believing that demand will be strong and this will likely power the companies that are listing. This has pushed investor confidence to sky-high levels.
2. Another reason is the IPO trend. Investors have seen umpteen number of IPOs list at a huge premium and there is nothing happening that indicates they should be more cautious at the moment except for the SEBI and some experts warning about overheated markets. Needless to say, investors are anticipating huge and immediate gains.
3. There is also the fact of the promoters having their feet on the ground. Most IPO subscription demand is healthy and listing gains are mouth-watering because of reasonable ask valuations and favourable market conditions. This is not only encouraging investors to put in their money, it is also boosting promoters confidence in being able to raise funds.
4. The NDA government has been gung-ho on infra projects. The spending has been massive, and the trajectory of the nation’s growth is soaring high luring promoters and investors into participating in the IPO market.
5. And finally, there is a lot of liquidity in the financial system. It is literally awash in deployable funds, especially in the hands of retail investors.
Prizor Viztech IPO, Sahaj Solar IPO to Ganesh Green Bharat IPO, in India, IPO subscriptions are soaring and there are various reasons why. Check out these 5 factors driving the IPO boom in India. Markets Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
