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With issues worth over Rs 35,000 crore, April set for IPO rush

The month already saw a bumper issue -- the Rs 4,275-crore offer-for-sale by Bharti Hexacom earlier this week.

MUMBAI: Amid the two-month-long, seven-phase general elections ending early June, companies looking to hit the capital markets with primary and secondary issues are advancing them to April. Nearly a dozen issuers are lining up equity sales worth over Rs 35,000 crore in the month. The month already saw a bumper issue -- the Rs 4,275-crore offer-for-sale by Bharti Hexacom earlier this week.

The bundling of the issues, according to two investment bankers, is primarily because Maharashtra and Gujarat--two of the largest markets for capital markets in particular and overall investments in general—will be going to the polls in May in multiple phases.

The new fiscal got off to a smooth ride with the Rs 4,275 crore offer for sale by Bharti Hexacom, an arm of the mobile major Bharti Airtel, which got listed with a 32.4 percent gain over the issue price of Rs 570. According to Axis Capital, one of the leading domestic i-bankers, there are over 30 issues lined up for the first quarter, most of which will take place in April and June.

According to Axis Capital, in the last fiscal 80 issues raised Rs 68,000 crore through IPOs/FPOs/OFSes and this fiscal is likely to see more than 120 issues which are likely to mop up over Rs 1.25 trillion, or 30 issues each quarter.

Two i-bankers, who wished not to be quoted, told The New Indian Express Friday that they are working on nearly a dozen issues which are likely to collectively garner over Rs 35,000 crore. More than half of this (Rs 18,000 crore to be precise) will come from the follow-on-public offer (FPO) being launched by the financially struggling mobile operator Vodafone Idea next week.

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The other major issues include the Rs 5,000-crore issue from the Blackstone-backed Adhaar Housing (which will mostly be an OFS like Bharti Hexacon which was fully OFS) and the Rs 3,000-crore issue from the Bengaluru-based pharma services player Indegene, besides a small issue of Rs 125 crore from the fintech player Akme Fintrade.

Other issues in the pipeline for the current quarter, according to an Axis Capital note, include standalone insurance player Digit, Fincare Small Finance Bank, water technology player Denta, piping systems player Dee Development Engineers, CJ Darcl Logistics, developer Arkade, Ebixcash, SPC Lifesciences, Stanley Lifestyles, JNK India and Indo Farm Equipment, Western Careers India, and Survical Technologies among others.

Barring Akme Fintrade, which is a fully fresh issue, all others issues are mostly OFS with a minor portion of the issue being a fresh issue of shares.

More than 40 issue applications are pending with Sebi, according to the Axis Capital note, which includes a Rs 7000 crore issue (Rs 1250 fresh issue and the rest OFS) from the construction major Pallonji group's Afcons, another Rs 7,000 crore issue from Ola Electric, Rs 1,200 crore issue from PN Gadgil Jewellers; Rs 1,000 crore issue from Northern Arc Capital, Rs 1,500 crore issue from the liquor major Allied Blenders & Distillers, Rs 1200 crore issue from Emcure Pharma, Rs 1,500 crore issue from Ashirwad Microfinance, Kerala-based jewellery major Joy Allukas, a mega issue from NSDL which will be fully an OFS, among others.

According to Mahavir Lunawat of Pantomath Capital Advisors, the IPO rush is spawned by the impressive economy, which has captured investors’ attention. Moreover, a wave of optimism has swept across the nation, drawing retail investors to invest, as they want to be part of the growth story.

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