The S&P BSE Sensex rose by just about 11 percent in the financial year 2018, compared to a blockbuster rally seen in the calendar year 2017, but there was plenty of action in the primary market space.
FY18 is set to go down as the busiest financial year in Indian history in terms of IPO volume raised. During the year, till date, 38 IPOs have concluded with IPO fundraising volume of above Rs77,000 crore, Centrum Broking said in a report.
Further, at least 3 more IPOs are lined up in the remaining few days of the financial year, racing against the time to conclude these IPOs before LTCG taxation kicks-in starting April 1, 2018.
3 IPOs yet-to-list are: ICICI Securities, Mishra Dhatu Nigam and Lemon Tree Hotels which are expected to raise over Rs 5,000 crore, taking the total tally to Rs 82,000 crore.
Of the IPOs of this financial year, best return came from Shankara Building Products (at 271.1%) followed closely by Apex Frozen Foods (at 269.4%). Other IPOs which have given more than over 100% returns are Salasar Techno Engineering (199.9%), Astron Paper & Board Mills (134.1%) and PSP Projects (126.2%).
Of the 38 IPOs listed during the financial year, 26 IPOs have given positive returns, while the remaining 12 have posted negative returns with S.Chand & Co happens to be the biggest underperformer with -37.1% return.
The Centrum report further highlighted that the average return from these IPOs is very healthy at positive 39.2 percent. In the next financial year, we expect IPO market to remain healthy.
However, the health of the primary market is a function of the health of the secondary market. “So, the IPO market robustness depends largely on the sustainability of secondary market conditions, political certainty, and government disinvestment program,” said the report.
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