Funds raised by qualified institutional placements declined 67 per cent to Rs 9,335 crore. Funds mobilised via offer for sale and real estate investment trusts/infrastructure investment trusts fell 23 per cent and 92 per cent, respectively, according to PRIME Database.
About Rs 20,557 crore, or 39 per cent, of the amount raised in FY23 was by Life Insurance Corporation (LIC) of India alone, without which the IPO fundraising would have been just Rs 31,559 crore. The amount raised in FY23 is still the third highest ever in terms of IPO fundraise,” observes Pranav Haldea, managing director, PRIME Database Group.
The IPO activity was sporadic in FY23, with 25 of the 37 IPOs taking place in just three months (May, November, and December), “This shows the volatile conditions prevalent through most of the year not conducive to IPO activity. The fourth quarter of FY23 has seen the lowest amount being raised in nine years,” says Haldea.
In terms of investor response, 11 IPOs received more than 10x subscription (of which two IPOs got more than 50x), while seven were oversubscribed more than 3x. The balance of 18 IPOs was oversubscribed between 1x and 3x.
The after-listing performance of IPOs was modest, with average listing gain falling to 10 per cent, from 33 per cent in FY22 and 36 per cent in FY21.
Currently, about 21 of the 36 IPOs are trading above the issue price (as indicated by the March 24 close).
About 68 companies filed their draft red herring prospectus with the Securities and Exchange Board of India (Sebi) during the year, down from 144 in FY22. The year was also the first-ever filing under the confidential route by Tata Play (formerly Tata Sky).
“Nearly 37 companies looking to raise nearly Rs 52,060 crore let their approvals lapse in FY23. Twelve companies looking to raise Rs 10,386 crore withdrew their offer document. Sebi returned the offer document of a further nine companies looking to raise Rs 20,330 crore,” says Haldea.
About 54 companies proposing to raise Rs 76,189 crore have already obtained Sebi approval. Another 19 companies looking to raise about Rs 32,940 crore are awaiting approval. Of these 73 companies, four are new-age tech firms looking to raise roughly Rs 8,100 crore.
With one trading session remaining, the benchmark S&P BSE Sensex and the National Stock Exchange Nifty are down 1.6 per cent and 2.9 per cent, respectively, in FY23.