NEW DELHI: India’s primary market has just had its day in the sun, days actually!

In just 91 days from September 1 to November 30, India Inc raised nearly $8 billion through initial public offerings (IPOs) accounting for nearly 80 per cent of all funds raised from the primary market in 2017.

That was the total mopup of 16 companies, but the lion’s share of $7 billion was raised by four big insurers and one re-insurer.



Of this, GIC Re accounted for 17 per cent, New India Assurance 15 per cent, HDFC Life 13 per cent, SBI Life 13 per cent and ICICI Lombard 9 per cent; making up for 66 per cent of total fund raising during the period, Edelweiss Securities said in a report.

Others on the list included FMCG (7 per cent), infrastructure and engineering (7 per cent), IT and media (5 per cent) and pharma (3 per cent) companies.



“Nifty50's earnings growth for September quarter stood at 12.5 per cent on an adjusted basis, but for the broader market, let us say BSE200, the growth was just about 6.5 per cent. Even as both these numbers met or slightly exceeded market expectations, there has been no meaningful upgrade in stocks. Investors are finding it difficult to really hunt stocks. Therefore, liquidity is going into IPOs,” said Mahantesh Sabarad, Head of Retail Research, SBI Cap Securities.

“That’s why IPOs and even ETFs like Bharat22 are seeing huge subscriptions. It quite ironical that abundant liquidity is getting absorbed by IPOs. We do not know how long this is going to continue,” Sabarad told ETNow.

The IPO market has been booming in size and numbers, with diverse sectors and companies tapping the primary market to raise funds. The brokerage noted issue size has a negative coefficient, which means higher the issue size is the lower the chances of listing gains.

Overall, CY17 has been the best year in terms of fund mobilisation through the IPO route. The year has seen companies moblise $10 billion, with one month of the calendar yet to go.