NSE emerges as the preferred designated exchange for large sized issues in FY 16
Corporates raise about 10 times more funds via IPO in FY16
Mumbai / Chennai: In a significant jump over the previous financial year, corporates have raised Rs. 14508.11 crore via Initial Public Offer (IPO) in the current financial year (FY) 2015-16. The year saw 22 corporates making their debut on the exchange platforms in India. More than 66% issues of over Rs. 500 crore have selected the leading bourse National Stock Exchange (NSE) as the designated exchange.
Among the listed entities, infrastructure companies dominate the chart with about 33% of the entities representing the sector. In spite of volatile secondary market, fund raised through IPO issuances in FY 2015-16 have witnessed an increase of more than 10 times of FY 2014-15. Last year, total money raised was Rs 1418.21 cr. As many as 21 out of 22 entities were oversubscribed during the current FY, while 15 reported listing gain. Apparently, most of the offerings were from corporates who had sizable private equity fund in their holding structures.
Apart from the economic scenario, an enabling legal framework may have also helped the IPO market. Capital market has seen introduction of some prominent norms and regulations to make fund raising process simpler and less time consuming.
Among the regulatory developments that took place in FY2015-16, announcement regarding the launch of e-IPO gateway seems to have helped many investors. The market regulator SEBI has approved norms for companies to launch their initial public offerings (IPOs) in an electronic form (e-IPO), to reduce the time taken between the share sale and the listing, to enhance the reach of retail investors in the share sale, and reduce costs.
