The fourth-quarter of 2020 witnessed 19 Initial Public Offerings (IPO) in India, reflecting strong momentum and a sharp rise after the COVID-19 economic slump. The market sentiment can remain optimistic if the upward trend continues in 2021, according to leading consultancy EY's India IPO Trends report.
There were a total of 10 Initial Public Offers (IPOs) in the main market and 9 in the SME (Small and Medium Enterprises) segment in 2020 Q4, the report said.
There were 19 IPOs recorded in the latest December quarter which were valued at USD 1.836 billion with the largest amongst them being Gland Pharma with an issue size of 869 million US dollars. There were just 11 IPOs in the year-ago period.
"There is strong momentum in the IPO markets, and we are seeing an increased interest from companies across sectors looking to raise capital in the near term. Additionally, companies are keenly awaiting guidelines for a direct listing in overseas markets. The market sentiment remains positive for what could be a stellar 2021," Sandip Khetan, Partner and National Leader, Financial Accounting Advisory Services (FAAS) at EY India, said.
India ranks ninth globally in terms of the number of IPOs in 2020 with 43 IPOs raising USD 4.09 billion, as per the report.
COVID-19 struck difficulties for the majority of the economy with unwanted shutdowns taking place but the pandemic struck a chord with the IPOs and proved to be resilient for it. Supported by low-interest rates and expansionary monetary policies, IPOs largely gained from the slump, it said.
"Despite a challenging year, 2020 activity in the Asia-Pacific region surpassed 2019, increasing 20 per cent (822) by volume and 45 per cent (USD 136.2 billion) by proceeds in 2020.
"In fact, the region saw the highest proceeds since 2010. Industrials led the sectors with 181 IPOs raising USD 20.8 billion in proceeds, followed by technology with 180 IPOs and USD 38.7 billion in proceeds, and materials, which saw 95 IPOs raising USD 7.4 billion," the report said.
