India emerged as a global leader in initial public offerings (IPOs) for 2023, securing the top spot worldwide with no cross-border deals reported, as per a recent EY report. During the final quarter of 2023, both the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) of India witnessed a significant surge in IPOs, totaling 92 launches. Notably, the primary markets saw a remarkable uptick, with BSE and NSE recording 31 IPOs (including one InvIT) in Q4 2023, marking a substantial 72% increase over the same period in 2022 and a notable 41% increase over Q3 2023. Furthermore, the Small and Medium Enterprises (SME) markets exhibited considerable growth, witnessing 61 IPOs in Q4 2023, reflecting robust increases of 79% and 30% compared to Q4 2022 and Q3 2023, respectively.
Mr. Adarsh Ranka, Partner and Financial Accounting Advisory Services Leader at a member firm of EY Global, foresees ongoing expansion in the Indian IPO market in Q4FY24. This growth is attributed to optimistic investor sentiment, a robust economy, and expectations of lower inflation and rate cuts in 2024. The report underscores the fourth quarter of 2023 as a standout period, representing nearly 40% of the year’s total listings. Despite a sluggish start in the first half, IPO activity surged notably in the latter half, with over 18 companies filing their Draft Red Herring Prospectus (DRHPs) in Q4 2023, indicating a potentially brighter outlook for 2024.
