Revival signs in primary market: Over a dozen IPOs set to launch

New Delhi: After a sluggish start to 2025, the primary market is showing signs of revival with over a dozen companies having lined up their IPOs in the next three to six months buoyed by a stabilizing secondary market and easing geopolitical tensions, merchant bankers said.

Among the companies preparing to tap the capital markets are HDB Financial Services, a subsidiary of HDFC Bank, National Securities Depository Ltd (NSDL), Kalpataru, Rubicon Research, All Time Plastics, Regreen-Excel EPC India, and Paramesu Biotech, they added.

Additionally, Credila, SK Finance, Veritas Finance, Paras Healthcare, CIEL HR Services, Avanse Financial Services, Drof-Ketal Chemicals India, Brigade Hotel Ventures and Shreeji Shipping are looking to launch their IPOs.

All these companies have already received clearance from the markets regulator Securities and Exchange Board of India (Sebi).

These companies are mobilising funds to support capital expenditure requirements especially for expansion plans, repayment of borrowings, and for general corporate purposes.

This renewed activity follows the launch of six IPOs last month, including Schloss Bangalore, the owner of luxury hotel chain The Leela.

However, the overall IPO activity in 2025 has slowed, with only 16 firms coming out with public issues so far, compared to 29 IPOs in the same period last year. The slowdown is attributed to ongoing volatility in the equity market due to a mix of global and domestic factors.

This shift followed a remarkable 2024, in which 91 maiden public issues collectively raised Rs 1.6 lakh crore, driven by robust retail participation, a resilient economy, and booming private capital expenditure.

Despite the cautious start to 2025, there are promising signs. A growing number of companies are filing documents, and the second half of the year is expected to witness robust IPO activity.

"We will see robust activity in the IPO markets in the second half of 2025 as a good set of companies are looking to launch their public issues. There is a good appetite among investors for attractively priced IPOs," said Saahil Kinkhabwala, Director, Investment Banking, Monarch Networth Capital Ltd.

Pranjal Srivastava, Partner, Investment Banking, Centrum Capital, noted that the Indian IPO market's sluggish beginning in 2025 reflects cautious investor sentiment amid global economic uncertainties and domestic market volatility.

"While the pipeline remains strong with several companies awaiting regulatory approvals and DRHP filing momentum continuing as last year, both issuers and investors are taking a wait-and-watch approach. We expect activity to pick up gradually during the rest of the year as market conditions stabilize and confidence returns," he added.

So far, 65 companies have received final observations from Sebi, and another 65 are awaiting final clearance, a necessary step before launching public issues.

Among the key players, HDB Financial Services' proposed IPO includes a fresh issue of equity shares worth Rs 2,500 crore and an offer for sale (OFS) of Rs 10,000 crore by promoter HDFC Bank, according to the draft red herring prospectus (DRHP).

Currently, HDFC Bank holds a 94.36 per cent stake in the non-banking financial company (NBFC).

The fresh issue proceeds will be used to bolster HDB's Tier-I capital base, supporting future capital needs such as increased lending and business growth.

Under RBI mandates, HDB Financial Services, classified as an upper-layer NBFC, is required to be listed on the stock exchanges by September 2025.

Meanwhile, NSDL plans to offer 5.01 crore shares in its IPO, a reduction from the initially proposed 5.72 crore shares, as per a recent addendum. Sebi has granted NSDL an extension until July 31, 2025, to complete its listing.

Other companies that have lined up their IPOs include both fresh issuance of equity shares and an offer for sale by existing investors.