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IPO mop-up plummets by 32 percent in H1

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IPO mop-up plummets 32 percent to Rs 35,456 crore in first half of FY22-23: Report

Representational image. News18

A total of 14 companies have raised Rs 35,456 crore via main-board initial public offerings (IPOs) during the first half 2022-2023, as per data by primedatabase.com.

Out of the 14 IPOs, only Delhivery was from a new-age technology company, which indicates that there has been a slowdown in public issues from this sector.

The total figure is 32 percent lower than Rs 51,979 crore raised via 25 IPOs in the corresponding period the previous year.

The amount would be even lower if not for the IPO of the Life Insurance Corporation of India. In 2022-23 Rs 20,557 crore (or 58 percent) was raised from LIC public issue alone.

The other two large IPOs in H1 were Delhivery (Rs 5,235 crore) and Rainbow Children’s (Rs 1,581 crore). The average deal size amounted to Rs 2,533 crore. The overall public equity fundraising also fell 55 percent to Rs 41,919 crore from Rs 92,191 crore in the year-ago period.

According to primedatabase.com, the overall public response was moderate. A total of four issues out of 14 got subscribed more than 10 times, while three IPOs were oversubscribed by more than 3 times. The rest of the seven IPOs were oversubscribed between 1 and 3 times. An encouraging response was seen in the new HNI segment, with five IPOs being booked more than 10 times.

Lower enthusiasm was seen in retail investors. The value of shares applied for by retail investors stood at Rs 23,880-crore, which was 28 percent of the total IPO mobilisation.

The average number of applications from retail investors dropped to 0.75 million from 1.55 million in 2021-22 and 1.24 million in 2020-21. LIC received the highest number of applications from retail investors which was 3.27 million, followed by Harsha Engineers (2.38 million applications) and Campus Activewear (1.72 million applications).

In the first half, the average listing gain plunged to 12 percent from 32 percent in 2021-22 and 42 percent in 2020-21. Out of the 14 IPOs, six gave over 10 percent returns. As of 26 September, 11 of the 14 IPOs were trading above issue prices.

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