IPO update: 3 issuances totaling Rs 1,700 crore to hit primary market on February 7

IPO Update: Activity in the primary market has increased with three entities – Rashi Peripherals, Jana Small Finance Bank and Capital Small Finance Bank – set to launch initial public offerings (IPOs) on Wednesday to raise a total of around Rs 1,700 crore. Additionally, Entero Healthcare Solutions will launch its Rs 1,600-crore IPO on February 9.

Additionally, the Rs 920-crore IPO of Apeejay Surrendra Park, which operates hotels under the ‘The Park’ brand, is currently open for subscription.

Last month, five companies entered the primary market and earned around Rs 3,266 crore. Market experts remain strongly optimistic about the prospects of the IPO (initial public offering) market in 2024. Businesses are expected to benefit from a stock market with abundant liquidity and a surge in new retail investors.

Neha Agarwal, Managing Director and Head (Equity Capital Markets), JM Financial said: “We have a strong bullish outlook on the IPO market in 2024. This optimism is boosted by strong domestic and foreign investments, while the Indian economy is doing well. The outlook is also driven by growth prospects.” Markets. Financial inflows are expected to gain more momentum once election-related uncertainties are resolved. “

The IPO of Rashi Peripherals, a distributor of information and communication technology products, is entirely a fresh issue of Rs 600 crore and does not include an offer for sale component.

The price band for its IPO has been fixed at Rs 295-311 per note. Of the funds raised from the IPO, funds worth Rs 326 crore will be used to repay debt and Rs 220 crore will be used for working capital requirements and general corporate purposes.

The offering by private equity major TPG and Morgan Stanley-backed Jana Small Finance Bank includes a major share sale of Rs 462 crore at the upper end of the price band and the remaining Rs 108 crore as an offer for sale. Its IPO raised 5.7 billion rupees and was priced in a range of 393-414 rupees per share. The Bengaluru-based bank will use the freshly issued funds to increase its core capital to meet future capital requirements and improve its capital adequacy ratio.

Capital Small Finance Bank’s Rs 523-crore IPO includes fresh issue of equity shares worth Rs 450 crore and OFS of Rs 73 crore, through which promoters and outside investors will dilute 5 per cent of their pre-issue holdings. The Jalandhar-based bank has set a price band for the IPO at Rs 445-468 per share.

It will use proceeds from the new issuance to expand its Tier 1 capital base to meet its future capital needs. Additional capital is expected to be needed as the bank continues to expand its loan portfolio and asset base. The IPOs of these three companies will close on February 9.

In 2023, a total of 58 IPOs were issued, raising Rs 52,637 crore. These include the Rs 3,200-crore IPO of Nexus Select Trust REIT. Fund raising in 2023 is lower than the Rs 59,302 crore raised by 40 companies in 2022. This was driven by LIC issuance of Rs 20,557 crore, which accounted for 35% of the total raised during the year.

(with PTI input)