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India IPO Market Hits $20B "New Normal"
9 Dec
Summary
- India's IPO market has reached a new normal of $20 billion annual issuances.
- Consumer technology drives nearly one-fifth of demand, expected to grow.
- India's overall market cap aims to double to $10 trillion in five years.
India's initial public offering (IPO) market has established a new benchmark, with annual issuances now consistently reaching $20 billion. This trend is expected to continue as an annualized run rate over the coming years, bolstered by strong investor interest. Consumer technology and new-age businesses are significant contributors, currently driving close to 20% of demand, a figure anticipated to exceed 30% in the next five years.
Significant future growth is projected, with at least 20 startups valued in the hundreds of millions preparing for IPOs, and several larger offerings exceeding $1 billion. This surge is partly driven by private equity funds seeking exits. Despite a current slowdown in fresh capital raising and qualified institutional placements, overall equity capital markets are expected to rebound with anticipated foreign inflows next year.
Looking ahead, India's financial landscape is set for substantial expansion, with the total market capitalization projected to double to $10 trillion within five years. This would place India third globally, following the United States and China. Concurrently, outbound mergers and acquisitions are showing traction, while Japan and the Middle East exhibit strong inbound investment interest, particularly in financial services.
