InvestorQ : How was the IPO and new issues market in FY21? I am told it was the best year in terms of IPO collections?
diksha shah made post

How was the IPO and new issues market in FY21? I am told it was the best year in terms of IPO collections?

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Anamika Sodhani answered.
5 months ago
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You are right that the new issues market or the IPO market did put up a very stellar performance in the financial year ended March 2021. In fact, despite the pandemic and the lag effect of the lockdown taking its toll on the market, the new issues market had its best year during the last one decade. In fact, if you consider the overall new issues market for equities then it did a record raising a total sum of Rs.188,900 crore during the year.

The figure of Rs.188,900 crore is actually much better than the Rs.175,000 crore that the IPO markets managed to raise in FY18. The big improvement was seen in the segment covering fund raising through qualified institutional placements. During the financial year 2020-21, the total collections through the QIP route was to the tune of Rs.78,731 crore. This is an indication of the institutional appetite for Indian paper.

Out of the total sum of Rs.188,900 crore that was raised during the financial year FY21, nearly 73% was raised through fresh capital raising while the remaining 27% was raised via offers for sale or the OFS route wherein the promoters or the early investors take an exit from the company through the IPO route. Indigo paints IPO received the maximum retail IPO applications at 25.88 lakhs followed by MTAR and Mazagon Docks.

Some of the drivers for this record collections in the fiscal year 2020-21 were a revival in the IPO market, elevated levels of interest from retail & HNI investors and a sharp revival in the REIT/INVIT market during the year. The QIP fund managed to raise Rs.78,731 crore and these issues were largely concentrated with banks, NBFCs and realty companies accounting which jointly accounted for 84% of the total QIP funds raised.

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