IPOs are back! Post budget scenario fuels primary market

Speaking to IIFL, Vishal Mehta, Managing Director, Infibeam said, “Post the Union Budget 2016, the market has show great potential. Hitting the market at this time gives us the sense of a win-win situation for the company and investors.”

Mar 15, 2016 11:03 IST IIFL Gaurang Damor |

IPO
After relishing an action-packed 2015, the primary market is all set for an encore in 2016 with as many as 20 companies have received Sebi’s nod for initial public offerings (IPOs), together looking to raise nearly 7,300 crore.
 
In addition, around 11 firms are expected to seek Sebi approval, to collectively mop up 5,445 crore, according to Prime Database.
 
Last week, Global Enterprises Ltd (HCG) announced a Rs. 650 crore IPO that will open for subscription tomorrow (March 16). Ahmedabad-based e-commerce firm Infibeam Incorporation and Bharat Wire Ropes will announce their IPOs today. Both the firms are expected to raise Rs. 450 crore and Rs. 70 crore respectively.
 
Speaking to IIFL, Vishal Mehta, Managing Director, Infibeam said, “Post the Union Budget 2016, the market has show great potential. Hitting the market at this time gives us the sense of a win-win situation for the company and investors.”
 
The sentiment at the main board and the SME platform as well is upbeat after Sebi eased the IPO norms. Many SMEs have also lined up to raise capital to meet expansion costs and general corporate purpose.
 
New Delhi-based Centre for Sight, Thyrocare Technologies, Nihilent Techonologies, GVR Infra Projects, Mahanagar Gas, GNA Axles and Maini Precision Products too have received a go-ahead from the market regulator.
 

IPO meter

 
Last year, as many as 20 firms on main-board got listed via an IPO and they had collectively mopped up Rs. 15,000 crore. This was the best performance of the IPO market in last 5 years. 2014 saw a mere 6 IPOs garnering Rs. 1,261. The table below shows how some of the IPOs have fared in last 6 months:
 
Company Issue Price CMP Change (%)
Dr Lal 550 881 60.18
SH Kelkar 180 244.9 36.05
Alkem Lab 1050 1358.75 29.40
Narayana 250 292.8 17.12
TeamLease 850 976 14.82
Interglobe 765 810.5 5.94
Prabhat Dairy 115 114.7 -0.26
Precision Camshaft 186 152.5 -18.01
Quick Heal 321 246.16 -23.31
CoffeeDay 328 227.4 -30.67
Last update: March 15, 9:45 am
 

SME platform shines

 
IPOs of small and medium enterprises (SMEs) have also made investors happy with many among them fetching double returns. Here’s a snapshot of SME IPO performance  in last six months:
 
Company Issue Price CMP Change (%)
Cawasji Behramji 14 32 128.57
Patdiam Jewellery 38 85 123.68
Universal Auto 15 33.1 120.66
Bella Casa 14 24.8 77.14
Vishal Bearing 25 29 16
Pecos Hotels 50 50 0
Tejnaksh HC 80 78 -2.5
Oyeeee Media 40 37.2 -7
Vaksons Auto 26 23.2 -10.76
OFS Technology 25 15.8 -36.8
Last update: March 15, 9:55 am
 
The Indian stock markets, which had technically entered a bear phase at the beginning of 2016, now seems recovering significantly on the back of budgetary announcements. The gradually improving macro scenario is another positive trigger. The overall scenario certainly generates positive sentiments for the IPO market in 2016.

Read More: Bharat Wire Ropes IPO opens on March 18
Infibeam to utilize IPO proceeds for expansion; to set up data center at GIFT City 

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