Dalal Street Investment Journal — July 10-23, 2017

46 DALAL STREET INVESTMENT JOURNAL I JULY 10 - 23 , 2017 DSIJ.in^

IPO MARKET IN 2017

What a year 2017 has been for IPO so far.

The beauty of the IPO markets in 2017

has been the numerous quality issues

rewarding the shareholders,thus boosting

investor sentiments.

Actually, healthy IPO market has been a

global phenomenon if we consider

H1FY17. Improved economic

fundamentals in developed economies

has been instrumental for healthy IPO

markets leading to impressive build-up

of IPO pipelines.

As majority of global markets touched

record highs in H1 of 2017, the global

IPO markets have not made the headlines

yet. With brightened investor sentiments

and positive global outlook the positive

momentum in the first half of 2017 is

expected to continue in second half of

2017 as well.

The year 2016 was a good year for the IPO

markets not only in India but globally as

well. For Indian markets, the year 2017

promises to surpass the IPO market

Special Report

IPOs

To Improve Investors

Portfolio Returns

Lohit Bharambe along with Smriti Sahu bring on the table some interesting observations on the

IPO markets in 2017 and explain why it makes sense to invest in IPOs from a strategic perspective.

performance of 2016 on all metrics,

including the number of issues and the

sizes of issuances.

The equity indices trending upwards with

low volatility has been the highlight of the

year 2017 so far. The same can be said

about the global equity indices as well.

Ample liquidity backed by improving

fundamentals in most markets were

instrumental in impressive performance

of IPO markets in 2017.

The first half of 2017 for the IPO market

has been most active since the H12007

globally. In India as well, the IPOs in the

first half have already surpassed the total

issue sizes for FY15 and FY14 put

together. To be fair only 6 companies hit

the primary market in 2014 and 21

companies got listed in FY15. The years

2014 & 2015 will not be remembered as

active years for the primary markets.

However, if we compare the issue sizes

in H12017 with H12016, the IPO

market has shown a growth of almost 93

per cent if we consider the data till June

2017. 
      

H1 No of Cos Total Issue size (Cr)

2016 11 7495.55

2017 16 14521.6

So far in 2017, 16 companies have hit

the primary markets and have managed to

raise `14,521.60 crore. With a promising

pipeline of IPOs slated to hit the primary

markets in 2H2017, the year 2017

promises to keep investors busy.

If we compare the performance with

the peak years for IPO markets such

as 2007 and 2008, the performance in

2017 stands impressive. Already in

H12017, the money raised is equal to

nearly 80 per cent of the total money

raised for FY2008. However, the total

money raised in H12017 stands at a

paltry 33.5 per cent of the total money

raised in FY2007.

We can safely say that the IPO market

performance in 2017 is one of the best

performances since 2007,i.e. since last 10

years.