NEW DELHI: In one of the busiest weeks for India’s primary market, five initial public offerings (IPOs) attracted bids worth Rs 2.6 lakh crore from investors. This is staggering given that they were seeking to raise a combined sum of only Rs 7,380 crore from their initial share sale.
Market analysts noted that as the IPOs are coming at fair valuations both investors and speculators are expecting listing-day gains. Their belief is backed by the grey market premium of these shares. Fomo (fear of missing out) has also gripped them V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said investors piling on to new offerings is a reflection of the structural shift in the financialisation of savings in India.
“Impressive growth of India’s GDP and good performance of the corporate sector and the secondary market is facilitating the growth of the primary market. This momentum is likely to continue going forward,” Vijayakumar said.
The IPO of Tata Technologies received bids worth Rs 1.57 lakh crore against its issue size of Rs 3,043 crore. It attracted about 73.6 lakh applications, the highest ever for any IPO in Indian primary market history, surpassing the Rs 21,000 crore- IPO of LIC, which received 73.4 lakh applications last year.
Tata Technologies was subscribed by a whopping 69.43 times on Friday close. Qualified institutional buyers subscribed by 203.41 times to this offering. The portion set aside for non-institutional investors was subscribed by 62.11 times.
The Rs 2,151 crore IPO of the state-run Indian Renewable Energy Development Agency received bids worth more than Rs 59,000 crore. Subscribed nearly 39 times, the IPO received 28.6 lakh applications.
The small IPOs of Flair Writing and Gandhar Oil were also in high demand among investors. The Rs 593 crore IPO of Flair received bids worth Rs 19,550 crore the Rs 501 crore IPO of Gandhar received bids worth Rs 22,640 crore.
The Rs 1,092 crore IPO of Fedbank Financial Services was subscribed 2.2 times and it received bids worth Rs 2,012 crore.