IPOs in H1 2025 were priced to perfection; be selective now, say analysts

Indian primary markets have posted tepid performance in the first half of calendar year 2025 (H1CY25). Of the 19 stocks that debuted on the stock exchanges in H1, as many as 10, or 53 per cent, are trading below their listing price now, according to data compiled by Business Standard.

 

Notably, so far in 2025, 19 companies have gone public from the mainline segment, raising ₹29,834 crore.

 

Of these, stocks of 10—including Stallion India Fluorochemicals, Indo Farm Equipment, Laxmi Dental, Denta Water and Infra Solution, Borana Weaves, Ather Energy, Standard Glass Lining Technology, Schloss Bangalore, Belrise Industries, and Arisinfra Solutions—are trading below their listing price. 

 

 

Further, barring Laxmi Dental, Borana Weaves, and Standard Glass Lining Technology, the rest are also trading below their issue price. 

 

According to data, 82 companies in the SME segment have debuted on the exchanges so far this year, raising ₹3,645 crore. Of these, 46 are trading below their listing price, and 45 are below their issue price. 

H1 2025 Primary Market Performance (as of June 25, 2025
Total Mainboard IPOs	19
Total amount raised	₹29,834 crore
Trading below listing price	10/19
Trading below issue price	7/19
Total SME IPOs	82
Total amount raised	₹3,645.3 crore
Trading below listing price	46/82
Trading below issue price	45/82
Source: Bloomberg

Priced to perfection

Sunny Agrawal, head of fundamental equity research at SBICap Securities said a consistent trend that stood out in H1 was the fact that most IPOs were priced to perfection, leaving very little on the table for new investors. This has resulted in muted listings across several recent IPOs.

 

Echoing similar views, Prashanth Tapse, senior VP (Research) at Mehta Equities, said that many offerings lacked strong revenue or profit growth visibility.

 

“Once listed, such companies face pressure to deliver results in line with expectations—but post-IPO earnings have often disappointed, leading to steep corrections. The market, being increasingly valuation-conscious, is quick to penalise underperformance, triggering sell-offs,” said Tapse.

 

Geopolitical developments amid tariff woes that troubled the secondary markets in H1 were another cause of primary markets’ tepid show in H1.

 

“Volatility spooked investors, especially retail participants, leading them to exit IPO stocks quickly—even with modest listing gains. As a result, sustainable post-listing rallies have been rare, with many investors preferring safety over potential upside,” Tapse added.

Primary market outlook H2CY25

Analysts, while expecting the primary market to witness the rollout of a healthy number of IPOs, remain divided on their performance in the second half of the calendar year.

 

"We have already seen robust investor interest across both primary offerings and secondary market block or bulk deals. There’s ample liquidity and merchant bankers and promoters are likely to capitalise on the current environment," said Agrawal.

 

Tapse, on the other hand, recommends a disciplined, cautious approach with a long-term mindset for IPO investors in 2025. After the underperformance of many H1 listings, he said, investor appetite has become more selective. “H2CY25 is expected to remain active, but more selective and valuation-conscious compared to the frenzied activity seen in previous years,” he added. 

Top picks

Among companies that investors can still consider, Agrawal believes Standard Glass stands out. With global uncertainties easing and a resurgence in capex expected from pharma and chemical firms over the next 2–3 years, the stock is well-positioned as a key beneficiary. Agrawal also remains bullish on Quality Power, stating, "Despite a 50 per cent rally in the past month, it remains a strong play in the power ancillary space and could be a good 'buy-on-dips' candidate for long-term portfolios." Oswal Pumps and Belrise Industries are among his other picks.

 

Tapse, on the other hand, picked Belrise Industries, Ajax Engineering, and Oswal Pumps for investors. On Belrise Industries, Tapse said, "It has a strong presence in auto component manufacturing with solid export potential." On Ajax Engineering, he noted the company has "a robust order book in infrastructure equipment and plays well into India's capex cycle." Further, on Oswal Pumps, he said the company is "an established brand in water management solutions with growth potential in semi-urban and rural markets."