Will India's IPO market scale new heights in 2025? Experts predict this

IPOs in 2025: The year 2025 may shape up to be another blockbuster for the Indian IPO (initial public offering) market, building on the strong foundation set in 2024. Market analysts anticipate the strong momentum to continue in 2025, offering ample opportunities to investors to dive across diverse sectors and industries.

 

Notably, in 2024, 96 mainline offerings and 241 small and medium enterprises (SME) raised a whopping Rs 1.71 trillion, marking a remarkable year for primary market investors, according to data from Prime Database.

 

This, Ajay Garg, director and CEO, SMC Global Securities, said, is a sign of India's growing primary market and a rise in investors' risk appetite. Capital market regulator Securities and Exchange Board of India's (Sebi's) focus on the quality of SME IPOs and new norms will build a stronger and more trustworthy environment for investors in 2025. 

 

"FPIs are continuously pulling out funds from the secondary market, but they were net buyers in the primary market in 2024. Due to the fair pricing and reasonable valuations, FPIs' attention was drawn towards IPOs (including the QIB route), and they have invested Rs 1.03 trillion as of November 2024," said Garg.

 

Going ahead, Garg expects this momentum to continue in 2025 with IPOs coming from new-age sectors such as quick commerce, EV, and auto-tech.

 

For now, 24 companies have received Sebi's approval to launch their IPOs. This pipeline is expected to expand further as an additional 62 companies have filed their draft red herring prospectuses (DRHPs) and are awaiting clearance. Collectively, these companies are estimated to raise around Rs 1.54 trillion from public offerings, data from PRIME Database showed.

 

National Securities Depository (NSDL), Ecom Express, SK Finance, Avanse Financial Services, and Manjushree Technopark are among the most awaited public offerings that have received Sebi’s approval.

 

Meanwhile, LG Electronics India, Shivalik Engineering Industries, Dr Agarwal's Health Care, Hexaware Technologies, Continuum Green Energy, Ather Energy, JSW Cement, and HDB Financial Services are some of the companies that have filed their draft papers with Sebi and are awaiting approval.

 

This robust pipeline, according to Prashanth Tapse, senior vice president and research analyst at Mehta Equities, reflects the continued momentum in India's primary market. "India has become a global leader, surpassing the US and Europe in IPO activity," he added.

 

Tapse believes the robust investor response to IPOs in 2025 may be driven on the back of record-breaking subscription demand in 2024, impressive listing gains, and a booming retail investor base.

 

According to a recent NSE report, over 3.5 million new retail investors joined the market in 2024, taking the total investor count to 108.5 million by the end of November.

 

This growing investor confidence, despite some volatility in the secondary market, Tapse believes, underscores the resilience and strength of India’s financial ecosystem.

 

With such a vibrant IPO lineup, Tapse predicts that 2025 will offer ample opportunities for investors, catering to diverse sectors and industries. "The enthusiasm from retail and institutional investors alike suggests that the Indian market will remain a focal point for global and domestic investors, further strengthening the country’s economic growth story," Tapse added.