IPO proceeds up fivefold in Apr-Sept

39 IPOs in H1FY16 versus 25 a year ago; 12 were main board IPOs that mobilised 97% of collections; balance 27 were SME IPOs

In the first half of this financial year, the amount raised through initial public offerings (IPOs) rose nearly fivefold to Rs 4,950 crore compared with Rs 1,017 crore in the year-ago period.

During April-September, 39 IPOs hit the market, compared with 25 in the corresponding period last year. Of these, 12 were main-board IPOs; these mobilised Rs 4,777 crore (97 per cent of the amount). The rest, SME IPOs, mobilised Rs 173 crore. UFO Moviez (Rs 600 crore) and Navkar Corporation (Rs 600 crore) were the largest main board IPOs, while Amrapali Fincap (Rs 40 crore) was the largest SME IPO. An additional Rs 12,916 crore was raised through the offer for sale (OFS) mechanism; Rs 12,733 crore was raised through government OFS, the most in the first half of a financial year. Most of the OFS amount was garnered through Rural Electrification Corporation (Rs 1,610 crore), Power Finance Corporation (Rs 1,673 crore), Dredging Corporation of India (Rs  53 crore) and Indian Oil Corporation (Rs 9,396 crore).

“It is positive to see action on the divestment front in the first half of a financial year, where traditionally, small amounts have been raised by the government in the past several years,” said Pranav Haldea, managing director, PRIME Database.  According to PRIME, 16 per cent of the overall amount raised in the first half (Rs 2,918 crore) was through fresh capital, which typically goes into creation of productive assets. The remaining Rs 14,949 crore was raised through OFS, in which case proceeds go to the sellers --- the government, promoters, venture funds and other investors, not to the company.
 

Of the 12 main-board IPOs, 10 saw participation from anchor investors.

Experts said large IPOs were yet to hit the market. “The pipeline looks promising. At present, 19 companies, planning to raise Rs 11,545 crore, have secured Sebi approval. Another 17, intending to raise Rs 6,795 crore, have filed with Sebi and are awaiting approval,” said Haldea.



“It is positive to see action on the divestment front in the first half of the fiscal, a period where traditionally small amounts have been raised by the government in the last several years,” said Pranav Haldea, managing director, Prime Database.

According to PRIME, only 16 per cent of the total amount raised in the first half (Rs 2,918 crore) was raised through fresh capital, which typically goes into creation of productive assets, while the remaining Rs 14,949 crore was raised through offers for sale where the proceeds go to the sellers-government, promoters, venture funds and other investors and not to the company.

Ten of the 12 main board IPOs saw a participation from anchor investors. According to experts, while several IPOs have hit the market this year, large IPOs are yet to hit the market. “The pipeline looks promising. At present, 19 companies planning to raise Rs 11,545 crore are holding Sebi approval and another 17 companies intending to raise Rs 6,795 crore have filed with Sebi and are awaiting approval,” said Haldea.