IPO launches to touch US$ 2.15 bn despite Omicron, interest rates in Q4

18 companies have filed their draft red herring prospectus with the SEBI since December 2021

January 13, 2022

Bankers are confident of market liquidity despite the potential impact of Omicron and interest rate hikes

Waree Energies, Ixigo, ESDS Software Solutions and Emcure Pharmaceuticals are expected to launch IPOs

IPO pricing is expected to be hiked in line with the increase in interest rates in the USA

The banking sector is anticipating more IPO launches as against follow-up issues from January-March 2022

The January-March 2022 quarter is expected to see the launch of Initial Public Offerings (IPOs) worth more than US$ 2.15 billion (Rs 16,000 crore). Since December 2021, 18 companies have filed their draft prospectus with Securities and Exchange Board of India (SEBI) and entities including Waree Energies, Ixigo, ESDS Software Solutions, Hexagon Nutrition and Emcure Pharmaceuticals are expected  to launch their IPOs in the current quarter. Bankers are confident of adequate market liquidity despite the impact of the Omicron variant and the potential volatility in the secondary market as a result of interest rate increase in the United States of America. Experts observe that the pricing of the IPOs would be hiked in line with the pace of the aforementioned interest rate as well as the inflation component. The market is currently  bracing itself for three to four rounds of interest hikes. 

The banking sector has played a pivotal role in raising capital through follow-up issues since 2018 and industry experts foresee that the current quarter will see less follow-up issues. As a result, the sector is not expecting major fundraising across multiple sector barring potential acquisitions. The reasonable pricing of IPOs has been identified by experts as the need of the hour.

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