Two IPOs to open for subscription this week. Issue price, date, other details here

Two IPOs to open for subscription this week. Issue price, date, other details here

Two companies are set to hit the Indian market with their initial public offerings (IPOs) this week with the aim to raise over ₹2,500 crore cumulatively. Specialty chemical company Clean Science and Technology and construction firm GR Infraprojects IPOs are scheduled to open for subscription on Wednesday i.e., July 7 and close on Friday i.e., July 9.

IPOs this week -

GR Infraprojects: GR Infraprojects' initial public offering (IPO) will open for subscription on 7 July, Wednesday. The company has fixed a price band of ₹828-837 a share for its offering. The public issue comprises an offer for sale (OFS) of up to 11.5 million shares by promoters and shareholders.

The Udaipur-based firm is a leading integrated road engineering, procurement and construction (EPC) company with experience in design and construction of various road and highway projects across 15 states in India. It has recently diversified into projects in the railway sector.

Clean Science and Technology: The three-day IPO issue opens on July 7 and closes on July 9 and The initial public offering of Clean Science and Technology Ltd has a set price band of ₹880-900 apiece.

The company manufactures functionally critical specialty chemicals such as performance chemicals, pharmaceutical intermediates and FMCG chemicals. The company has multiple manufacturing facilities in Kurkumbh, MIDC Maharashtra that are automated to maintain high levels of accuracy and efficiency.

The Pune-based company’s customers include manufacturers and distributors in India as well as other international markets including China, Europe, the United States of America, Taiwan, Korea, and Japan.

After five companies that launched their offerings in the previous month and raised ₹9,923 crore through public issues, July is set to be the busiest month in terms of IPOs as many as eleven companies are expected to launch their issues with the aim to raise around ₹24,000 crore.

So far this year, 22 firms have come out with their IPOs to raise ₹27,426 crore. Apart from this, companies including Utkarsh Small Finance Bank and Glenmark Life Sciences, Rolex Rings and Seven Islands Shipping have received Sebi’s go ahead to float the IPO.

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Strong primary market show: 10 IPOs lined up for July and at least 20 for rest of 2021

IPO | Representative image

After a strong run in first half of 2021, the Indian primary market is expected to see continued action in July and the rest of the year.

The corporates wanting to raise funds from the market have been choosing the IPO (initial public offering) route lately. 39 corporates garnered nearly Rs 60,000 crore in last one year.

Although there was a lull in the primary market for a few weeks during the peak period of COVID second wave, 24 companies raised Rs 39,000 crore via IPOs in just the first half of 2021. Meanwhile, corporates raised around Rs 21,000 crore in second half of 2020 via IPOs.

In fact, benchmark indices also witnessed consolidation during April-May when the number of COVID cases were rising amid second wave. The number of daily new coronavirus cases peaked at around 4 lakh in early May.

But in June, the secondary and primary markets recovered and benchmark indices - Nifty and Sensex - hit fresh record highs. The BSE Sensex rallied more than 10 percent while the BSE Midcap index gained 26 percent and Smallcap index registered a 39 percent gains in first half of CY21.

Healthy momentum in the secondary market, ample liquidity in the system with global central banks keeping their monetary policies loose and greater participation of retail investors have been some of the factors keeping the IPO Street abuzz.

At least 20 companies, including Zomato, Aditya Birla Sun Life AMC and Rolex Rings, have already filed papers with Sebi for a public offer and are expected to launch their IPOs in the second half of 2021 to raise more than Rs 40,000 crore.

Out of these, 10 companies - GR Infra, Clean Science & Technology, Glenmark Life Sciences, Utkarsh Small Finance Bank, Vijaya Diagnostic Centre, Nuvoco Vistas Corporation, Aadhar Housing Finance, Shriram Properties, Seven Islands Shipping and Ami Organics - are lined up to launch their issues in July to raise around Rs 22,000 crore.

Some other companies like LIC, NSE and Policybazaar are known to be working on their public offerings.

Also read: Policybazaar aims to file DRHP for IPO in July, eyes $4-5 billion valuation

Expert Take

“Indian fundraising via IPOs is at a 13-year high because of flood of foreign money and unprecedented interest from retail investors. This has made India one of the hottest IPO markets in 2021,” Gaurav Garg, Head of Research at CapitalVia Global Research told Moneycontrol.

“As the markets trade at record high levels, we will keep on seeing more companies hitting the primary market as overall positive sentiment is very important for success of any initial offering,” he added.

Prashanth Tapse, VP Research at Mehta Equities, also expects more primary market offerings in the second half of 2021 as markets are at an all-time high and it is an ideal time to cash in the market euphoria by promoters.

According to him, investors' appetite is also likely to be high given better-than-expected listing performance from Shyam Metalics and Sona Comstar, followed by Dodla Dairy & KIMS Hospitals. “We assume most of the IPOs have been reasonably valued giving meaningful room for listing gains keeping investors interest in the game,” he said.

Also, other names like Zomato, LIC and NSE are in the pipeline to make an offer and get listed in this FY22, said Tapse.

Astha Jain, Senior Research Analyst at Hem Securities, too, expects primary market to continue to show strong momentum in H2CY21.

“We are expecting issuances of approximately Rs 45,000 crore in coming months,” she said.

The views and investment tips expressed by investment expert on Moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

2021 to be a Record Year for Fundraising via IPOs

40-odd issues on the way to mop up Rs 80,000 crore

2021 to be a Record Year for Fundraising via IPOs

The primary market, which has been on a non-stop rally, is set for a bumper Rs 80,000-crore bonanza with 30 companies already filing IPO papers to raise Rs 55,000 crore, while around 10 more are lined up for this month itself, seeking to mop up another Rs 25,000 crore, say, investment bankers.

The market has been hitting new records almost every week, on the back of an influx of investors – a vast majority of them first-timers – coupled with a flood of liquidity.

Foreign funds alone had pumped in a record $35 billion into the market in FY21, while the trend has continued this fiscal as well.

Domestic institutions led by LIC have also infused trillions of rupees, helping woo retail investors in troves. The year saw over 20 million new investors coming to the market.

Having already raised Rs 27,426 crore from 22 issues so far this year, 2021 is set to be a record year for fundraising through initial public offerings (IPOs).

In 2020, 16 issues had mopped up Rs 26,628 crore, and a similar number of IPOs had collected Rs 12,687 crore in 2019, but 2018 was the best year so far for the primary market as 25 companies had raised Rs 31,731 crore.

Some of the leading issues in the March quarter of the year included IRFC (Rs 4,633 crore), Indigo Paints (Rs 1,176 crore), Railtel (Rs 819 crore), Home First Finance, Laxmi Organic, Barbeque Nation, Anupam Rasayan, Kalyan Jewellers, Brookfield India Reit, Home First Finance, Stove Kraft, Nureca, and Heranba Industries, among others.

Apart from these, companies including Utkarsh Small Finance Bank, Glenmark Life Sciences, Rolex Rings, and Seven Islands Shipping have received Sebi’s go-ahead to float their IPOs.

Companies that are likely to hit the market this month include Glenmark Lifesciences, Zomato (roadshow for the Rs 8,500-crore issue is from Thursday), Windlas Biotech, Medi Assist TPA, Tatva Chintan Pharma, Paras Defence and Seven Island Shipping, together looking to raise about Rs 13,650 crore.

That apart, about 10 companies are also expected to file IPO documents with Sebi this month.

These include Star Health & Allied Insurance, Sapphire Foods, Northern Arc, Fino Payments Bank, Paytm, Ixigo, VLCC, Sahajanand Medical Technologies, Lava International, and Veeda Clinical Research, seeking to mop up Rs 25,000 crore.

Digital payments leader Paytm is planning an over Rs 18,500 crore issue and is likely to file the papers this month. If closed successfully, this will be the biggest issue ever in the country, after the around Rs 15,000-crore Coal India issue of October 2010.

The companies that have already filed the draft red herring prospectus (DRHP) with the market regulator include Aadhar Housing Finance, Zomato, Glenmark Lifesciences, Medi Assist TPA, Fincare Small Finance Bank, Chemplast Sanmar, Jana Small Finance Bank, Nuvoco Vistas, Cartrade, Arohan Financial Services, Windlass Biotech, Shriram Properties, Sansera Engineering, Supriya Lifesciences and Rolex Rings, among others, according to Sebi data.

According to merchant bankers, about 10 more companies are likely to file the DRHPs with Sebi this month itself to raise Rs 25,000 crore.

Companies are expecting to benefit from strong liquidity and a bullish secondary market, which has seen a sharp increase in the number of new retail investors.

With SIPs (systematic investment plans) continuing to lend firepower to mutual funds, in addition to the increased direct participation of retail investors, domestic funds are set to lap up the planned flurry of issuances, especially differentiated quality offerings.

“On the back of global liquidity, we’ve seen increased traction with foreign investors as well who are getting very bullish on India, especially the larger issues. We have seen over Rs 1 lakh crore flowing in as application money for any ‘hot IPO’, reflecting the appetite for large issues,” Ajay Saraf, head of investment banking and institutional equities at ICICI Securities, told PTI.

Two companies, Clean Science & Technology, and GR Infraprojects, are entering the market with their initial share sale offers this week to raise a little over Rs 2,500 crore cumulatively.

This comes after five companies – Shyam Metalics & Energy, Sona BLW Precision Forgings, Krishna Institute of Medical Sciences, Dodla Dairy and Indian Pesticides – had closed IPOs last month, collectively raising Rs 9,923 crore.

“During the past two years, we’ve had record participation in IPOs, including retail and HNI segments with massive over-subscription across sectors and issue sizes. This was because of a structural shift in risk appetite of retail investors, largely aided by the fall in interest rates on deposits, a maturing investment ecosystem and the changes in the demographics as the millennials of today are willing to take additional risks,” Subramanya S V, Co-Founder and Chief Executive of Fisdom, a digital-focused wealth management platform, told PTI.

“If the markets continue to remain buoyant, I believe there’ll be significant participation in forthcoming issues,” he added.