The Future of Fundraising through the IPO Market: A Promising Outlook
In recent years, the Initial Public Offering (IPO) market has emerged as a dynamic avenue for fundraising, particularly in India. With experts predicting a surge in capital raised through IPOs, the future looks increasingly optimistic. The Association of Investment Bankers of India (AIBI) has projected that as many as 1,000 companies may launch IPOs in the next two fiscal years, potentially leading to a remarkable capital formation of ₹3 lakh crore through Indian bourses by FY26.
A Record-Breaking Year
The year 2024 marked a significant milestone for India, as it achieved the top position globally in terms of IPO volume. With 335 IPOs, India outperformed both the United States and Europe, showcasing a robust appetite for public offerings. Mahavir Lunawat, Chairman of AIBI, highlighted this achievement, noting that India had more IPOs than both regions combined. This trend underscores the growing confidence of investors and companies in the Indian capital market.
Rising Fund Mobilization
Fund mobilization through IPOs has been on an upward trajectory over the past two financial years, and this momentum is expected to continue into 2026. In FY24 alone, ₹67,955 crore was raised through IPOs, complemented by 61 Qualified Institutional Placements (QIPs) that garnered approximately ₹68,972 crore. This collective effort has contributed to a total of ₹4.58 lakh crore raised by 851 companies over the last six fiscal years.
The Role of a Robust Ecosystem
The growth of the Indian capital market is not merely a product of favorable economic conditions; it is also a reflection of a well-structured ecosystem that supports fundraising activities. Prithvi Haldea, a prominent figure in the investment banking sector, emphasized the importance of creating a robust environment for capital formation. He noted that 2024 was a historic year for fundraising, driven primarily by IPOs and QIPs. Looking ahead, 2025 is anticipated to be even more buoyant, with stakeholders eagerly awaiting insights from the AIBI Annual Convention.
AIBI’s Commitment to Growth
The AIBI plays a crucial role in shaping the financial landscape of India. As the apex body of investment bankers, it is dedicated to fostering a strong investment culture. By providing direction and informed choices to stakeholders, AIBI aims to enhance the overall health of the capital market. The association’s efforts are pivotal in ensuring that the IPO market remains a viable and attractive option for companies seeking to raise funds.
Conclusion
The IPO market in India is poised for significant growth, with a promising outlook for the coming years. As more companies consider going public, the potential for capital formation through IPOs and QIPs is immense. With the support of organizations like AIBI and a conducive ecosystem, the Indian capital market is set to thrive, offering exciting opportunities for both investors and businesses alike. As we move forward, the emphasis on informed decision-making and strategic planning will be essential in navigating this evolving landscape.
(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times.)