【毕马威】2024年印度首次公开募股IPO市场分析报告英文版_18页_3mb

Summary of IPOs in India

Core Content

This document provides an in-depth analysis of the Indian capital markets, focusing on the performance of Initial Public Offerings (IPOs) in FY24 and the outlook for FY25. It highlights the resilience and growth potential of the Indian economy, the increasing interest in IPOs, and the regulatory changes that support the development of the capital market.

Main Points

• FY24 as a Breakout Year: The Indian capital market experienced a significant revival in primary issuances, with 76 mainland IPOs, the highest since FY17, and a 111% increase from FY23.
• IPO Trends: The average listing gain for FY24 was 29%, compared to 12% in FY23 and 25% in FY22. The number of IPOs oversubscribed by more than 100 times increased in FY24.
• Sector Performance: The Consumer Products and Retail sector led in fund raising, followed by Diversified Industrial Products, Financial Services, Healthcare, and Information Technology. The Industrial sector had the highest returns with 193%.
• Fund Allocation: Funds raised through IPOs were primarily used for debt repayment and capital expenditure, indicating a focus on financial health and growth.
• Foreign Investment: There was a significant inflow of foreign institutional investments (FIIs) into the Indian stock market, reaching INR 2,082 billion in FY24. The shift towards domestic institutional investors (DIIs) is expected to continue.
• Retail Investor Interest: Retail investors showed strong participation, with a notable increase in systematic investment plan (SIP) inflows, reflecting confidence in the market's long-term potential.
• Policy and Regulatory Developments: SEBI introduced several reforms, including a shortened IPO listing timeline and a new method for calculating market cap. The introduction of direct listings on GIFT City exchanges is also a key development.
• Global Outlook: The global economy showed signs of recovery in 2024, with India maintaining its position as one of the fastest-growing economies. However, uncertainties remain due to geopolitical tensions and economic challenges.
• Indian Economic Outlook: India is projected to grow at 6.8% in FY24, with continued momentum expected in FY25. The economy is expected to approach 7% real GDP growth, supported by strong domestic demand and a youthful population.

Key Information

• Total Funds Raised in FY24: INR 619 billion, with OFS contributing 53% and fresh issues 47%.
• Average Issue Size in FY24: INR 8 billion, down from INR 16 billion in FY23 and INR 25 billion in FY22.
• Total Subscription in FY24: INR 23,133 billion, showing a high level of investor interest.
• IPOs in Gain: 15 companies achieved more than 50% returns, while 17 had negative returns.
• Regulatory Changes:
  • T+1 Settlement Cycle: Implemented in 2023, reducing settlement time to one day.
  • Shortened IPO Listing Timeline: From T+6 to T+3, enhancing market efficiency.
  • Market Cap Calculation: Changed to a six-month average from a single day's figure.
  • Direct Listings on GIFT City: Expected to provide access to global capital and improve valuations.

Outlook

• FY25 Expectations: IPO activity is anticipated to remain robust, driven by strong economic growth, government reforms, and a vibrant startup ecosystem.
• Startup Ecosystem: India's startup ecosystem is on a revival path, with a third-place global ranking in unicorn count and a growing number of companies seeking to list in India.
• Economic Growth: India is projected to maintain its position as the fastest-growing major economy, with a target of becoming a USD 7 trillion economy by 2030.
• Inflation and Currency: Inflation is expected to decline from 5.4% in FY24 to 4.6% in FY25 and 4.2% in FY26. The rupee has shown stability, supported by improved external positions.
• Policy Continuity: The new government is expected to continue with policy continuity and reforms, which will support sustained growth in the capital markets.

Conclusion

The Indian capital market is demonstrating strong resilience and growth potential, with a notable increase in IPO activity and foreign investment. Regulatory reforms and improved market efficiency are contributing to this momentum. The outlook for FY25 remains positive, with continued economic expansion, a focus on innovation and digital transformation, and a growing number of companies seeking to list and access global capital.