2024 Sees Record IPO Fundraising of Rs 1.8 Lakh Crore

Chennai: Calendar year 2024 was a blockbuster year for the market as a record high Rs 1.8 lakh crore was raised through 317 Initial Public Offerings and Follow-on Public Offerings surpassing the previous record of Rs 1.3 lakh crore set in 2021. While small and medium enterprises too raised 87 per cent higher capital in 2024, their share shrunk to 5.3 per cent.

Against 2023, when 242 companies raised a total capital of Rs 57,600 crore, 2024 saw highest number of companies raising record high capital of through IPOs and FPOs, according to a report by Motilal Oswal. Of this, IPOs accounted for Rs 1.5 lakh crore and FPOs Rs 18,200 crore.

“The Indian IPO market has experienced an impressive year, with equity issuances across various categories increasing by 2.6x compared to the previous year. This remarkable growth can largely be attributed to the evolving nature of Indian equities, which are introducing new dimensions in the investment landscape, accompanied by robust fund inflows,” the report said.

The year marked the largest IPO in India as Hyundai Motor issued shares worth Rs 27,860 crore in October. This surpassed the previous record set by LIC, which raised Rs 20,560 crore in May 2022.

Companies from 23 different sectors raised funds through IPOs this year. Automobiles, Telecom, Retail, Capital Goods, and e-Commerce sectors dominated 2024 in terms of new listings, accounting for 59 per cent of the total issue size. About 43 per cent of the funds were raised by five companies – Hyundai Motor, Vodafone Idea, Swiggy. NTPC Green and Vishal Mega Mart.

On an aggregate basis, IPOs have been oversubscribed by 26.6x, attracting a subscription of Rs 46.7 lakh crore against the offer size of Rs 1.8 lakh crore.

Out of the 317 IPOs, 236 were offered by small and medium enterprises. The share of SMEs in the number of companies which went for IPO in 2024 was 74.4 per cent.

Though SMEs raised a total of Rs 9200 crore against Rs 4900 crore in 2023, their share went down to 5.3 per cent against 8.9 per cent in the previous year. Of the total capital of Rs 1.77 lakh crore, Rs 1.66 lakh crore was raised by other companies.

Around 151 IPOs received an overwhelming response, with more than 100x oversubscription, of which 141 were from the SME space. As many as 28 SME IPOs debuted with a premium exceeding 100 per cent, while 22 debuted at a discount to their offer prices.

SME IPOs also have outperformed since their listing. The aggregate market capitalization of all SMEs has increased by 31 per cent from the listing day. Small-cap stocks rose by 15 per cent since their listing, compared to large-cap and mid-cap stocks, which increased by 6 per cent and 14 per cent, respectively.