IPOs worth over Rs 40,000cr to hit D-Street in FY18: Watch out for these

Notwithstanding an outstanding performance last year, raising over Rs 26,000 crore, Initial Public Offerings (IPOs) of Indian companies are likely to garner much more in FY18.

While IPO funding hit a six-year high in 2016 with 26 companies collectively raising over Rs 26,000 crore, an article in the Economic Times pegs IPOs at worth over Rs 20,000 crore to be slated to hit the markets in the coming months.

V Jayasankar, Senior Executive Director & Head of Equity Capital Markets at Kotak Investment Banking, however, estimates a much higher quantum of over Rs 40,000 crore in IPOs and qualified institutional placement (QIPs) worth Rs 20,000-25,000 crore to hit D-Street in FY18.

While BSE kicked off the first stock exchange IPO in the country, D-Mart owner Avenue Supermarts and Jagran Prakashan arm and Radio City operator Music Broadcast saw stellar listings. CL Educates, and Shankara Building Products are among others to have recently closed issues and are awaiting listing.

Currently, five companies -- Hudco, Central Depository Services Ltd, S Chand and Company, Genesis Colors and Security & Intelligence Services (India) Ltd -- have received an approval from the market regulator Securities and Exchange Board of India (SEBI) to proceed with their IPOs. Few others including , Gitanjali Gems arm Nakshatra World, GTPL Hathway, NSE, Bharat Road Network, Tejas Networks, Eris Lifesciences, Salasar Techno Engineering, Au Financiers, Prataap Snacks, PSP Projects are still waiting for SEBI’s consent.

While the year gone by saw good sectoral breadth with companies from financials, consumer and retail, and others like commodities, healthcare etc. rushing in for IPOs, this year is going to be largely for financial services firms.

The Cabinet nod to listing of five state-run general insurance companies - New India Assurance Company, National Insurance Company, Oriental Insurance Company, United India Insurance Company and a re-insurance firm General Insurance Corporation -  apart from other big issues like that of SBI Life Insurance which is expected to file IPO papers in the near future and that of the National Stock Exchange estimated to be around Rs 10,000 crore hint at the high share that financial services will have.

The central public sector enterprise (CPSE) exchange traded fund (ETF) was another successful trend seen in FY17. Jayasankar expects this trend to continue into FY18 as investors find it quite attractive.