India a key driver in global IPO boom in the third quarter, says EY

547 IPOs the world over raised $106.3 bn in Q3 of CY2021, up 18% by deals than previous third-quarter record set in 2007 and 11% higher mop up than the last record setting third quarter in 2020

A rebound of initial public offer (IPO) markets in select regions, including India, helped the global IPO boom through Q3 2021, resulting in the most active third quarter by deal numbers and proceeds in the last 20 years.

"The key driver of activity in the third quarter was the rebound of IPO markets in Europe, Middle East, India and Africa (EMEIA). Particularly Europe, India and Tel Aviv exchanges, as well as IPO candidates racing to raise capital before expected tapering begins," said EY in a note.

According to EY, globally, there have been 547 IPOs raising $106.3billion in the third quarter of 2021. The third quarter saw 18 per cent more deals than the previous third-quarter record set in 2007 and 11 per cent higher proceeds than the last record-setting third quarter in 2020.

And year-to-date (YTD), there have been a total of 1,635 IPOs raising $330.7 billion. The Q3 totals YTD have already surpassed 2020 by both deal numbers and proceeds. In India, total proceeds in YTD 2021 are US$9.7b through 72 IPOs this is the highest first nine months proceeds in the last 20 years.

Sectorally, diversified industrial products dominated the Indian IPO market in the third quarter with eight issues, followed by the technology sector with five IPOs. The three largest IPOs in terms of proceeds were Zomato, Nuvoco Vistas and Chemplast Sanmar.

"The Indian IPO market has been on a bullish run and has witnessed one of the most active quarters since Q4 2017. The outlook for the next quarter remains positive with several new-economy, and technology-driven IPOs expected," Prashant Singhal, Emerging Markets, Technology, Media, Telecom (TMT) Leader, EY

In the future, EY said a few uncertainties lie ahead that could increase market volatility and challenges for a successful IPO. These include geopolitical tensions, regulatory changes, inflation risks and tapering by the US Federal Reserve.

"At the same time, new variants of COVID-19 are disrupting a full global economic recovery, and a majority of the sectors are affected.

Serious IPO candidates should look to prepare themselves as early as possible and be ready to launch quickly if needed," EY said.