The Surge of IPOs in India: A Look Ahead to 2025
India’s primary market is witnessing a remarkable resurgence, with a record ₹1.6 lakh crore raised through initial public offerings (IPOs) in 2024. This unprecedented figure has set the stage for an even more ambitious outlook for the coming year, as more companies are poised to tap into the primary market despite a somewhat uncertain equity landscape.
A Promising Pipeline
Experts predict that companies could raise around ₹2 lakh crore in 2025, buoyed by a robust IPO pipeline currently valued at ₹1.58 lakh crore. This optimism is underpinned by the belief that the current market valuations present a unique opportunity for companies looking to list. Investment bankers are advising firms to seize this moment, as the potential for high ratings is significant.
Andrew Holland, CEO of Avendus Alternate Strategies LLP, emphasizes the urgency for unlisted companies to consider going public. He notes, “Given the valuations you get in the marketplace now, for any company that is not listed, this is an opportune time to get a high rating. If you don’t use these kinds of valuations to get listed now, then you might be waiting a long time afterwards.”
Anticipated IPOs and Market Dynamics
Despite macroeconomic uncertainties, geopolitical tensions, and the looming threat of a liquidity crunch, bankers are gearing up for another blockbuster year. Some of the most anticipated IPOs in 2025 include major players like Zepto, Reliance Jio, Tata Capital, and Flipkart.
A strong pipeline of 67 companies, including Hero Fincorp, Aether Energy, and LG Electronics, is seeking to raise an estimated ₹1.25 lakh crore, pending approval from the Securities and Exchange Board of India (SEBI). Additionally, 14 companies have already received the green light to proceed with their IPOs, aiming to raise ₹33,350 crore, according to PRIME Database.
The Success of 2024
The momentum building for 2025 is largely a reflection of the stellar performance in 2024, where 92 mainboard companies successfully raised ₹1.6 lakh crore. Hyundai Motor India led the charge with a ₹27,870-crore offering, although it was notable for being one of the few large IPOs without any listing gains. Other significant public issues included Swiggy, Bajaj Housing Finance, Vishal Mega Mart, and NTPC Green Energy.
Diviay Chadha, a partner at Singhania & Co., points out that the strong demand from investors in 2024 could encourage companies to move forward with IPOs in 2025, especially those in high-growth sectors. He states, “The presence of a healthy pipeline indicates that confidence in the IPO market is still robust.”
Projections for 2025
Chadha projects that the IPO market could raise up to ₹1.9 lakh crore, contingent on market stability, interest rates, and international influences. If macroeconomic conditions remain favorable, sectors such as technology, green energy, and financial services are expected to drive growth.
Mahavir Lunawat, managing director of Pantomath Capital, shares an optimistic outlook, stating, “With the continued momentum in the markets, we now project that equity raised through IPOs will cross ₹2 lakh crore in 2025.” He highlights the strategic advantages of listing in India, such as reduced capital costs and a wide consumer market, which attract global players to consider Indian markets for their equity offerings.
India’s Global Standing in IPOs
Pantomath’s analysis reveals that India has hosted the highest number of IPO deals, with twice as many as the United States and 2.5 times more than Europe. The funds raised via IPOs in India are the second-highest globally, trailing only the US. This impressive standing underscores the growing confidence in India’s equity markets and the potential for continued growth.
Conclusion
As we look ahead to 2025, the Indian IPO market is poised for another significant year. With a strong pipeline, favorable valuations, and a growing appetite from both investors and companies, the stage is set for a vibrant primary market. While challenges remain, the optimism surrounding the IPO landscape reflects a broader confidence in India’s economic trajectory and its appeal as a destination for global investment.