India sees 19 IPOs worth USD 1.84 billion in 2020 December quarter

Reflecting strong momentum, India witnessed 19 initial public offers worth USD 1.84 billion in the fourth quarter of 2020 and market sentiment remains positive in what could be a stellar 2021, according to a report.

Leading consultancy EY's India IPO Trends Report: Q4 2020 showed that there were a total of 10 Initial Public Offers (IPOs) in the main market and 9 in the SME (Small and Medium Enterprises) segment during this period.

In the latest December quarter, there were 19 IPOs valued at USD 1.836 billion and the largest was that of Gland Pharma with an issue size of USD 869 million. There were just 11 IPOs in the year-ago period.

India ranks ninth globally in terms of the number of IPOs in 2020 with 43 IPOs raising USD 4.09 billion, as per the report.

"There is a strong momentum in the IPO markets, and we are seeing an increased interest from companies across sectors looking to raise capital in the near term. Additionally, companies are keenly awaiting guidelines for direct listing in overseas markets. The market sentiment remains positive for what could be a stellar 2021," Sandip Khetan, Partner and National Leader, Financial Accounting Advisory Services (FAAS) at EY India, said.

During the 2020 December quarter, main markets had 10 IPOs compared to 5 in the same period a year ago.

Real estate, hospitality and construction and diversified industrial products were the most active sectors (in terms of the number of IPOs) with three IPOs launched in each sector (including main and SME markets), the report said.

The report said that in 2020, global IPO volumes continued to accelerate, increasing by 19 per cent to 1,363 while proceeds increased 29 per cent year-on-year to a total of USD 268 billion.

Last year, IPO activity proved resilient to the impact of the COVID-19 pandemic supported by low interest rates and expansionary monetary policies, it said.

"Despite a challenging year, 2020 activity in the Asia-Pacific region surpassed 2019, increasing 20 per cent (822) by volume and 45 per cent (USD 136.2 billion) by proceeds in 2020.

"In fact, the region saw the highest proceeds since 2010. Industrials led the sectors with 181 IPOs raising USD 20.8 billion in proceeds, followed by technology with 180 IPOs and USD 38.7 billion in proceeds, and materials, which saw 95 IPOs raising USD 7.4 billion," the report said.