October IPO Surge: 21 stocks make Dalal Street debuts, 6 more set to list

While the secondary market has faced a steep decline in October, reaching levels not seen in more than four years, the IPO market is showing no signs of cooling. Investor interest in fresh listings has remained robust, even in the face of broader market volatility.

Overall, 21 companies have made their Dalal Street debuts in October so far, with another six slated to list soon, potentially bringing the total to 27, according to Trendlyne data. This strong lineup of IPOs showcases the steady momentum in primary market activity, even as secondary markets experience heightened volatility.

Notably, October has seen the country’s largest IPO to date—Hyundai India—which raised ₹27,870 crore from Indian investors through the Offer for Sale (OFS) route. However, retail investor interest in this offering was unexpectedly low, resulting in a less-than-full subscription.

This lack of enthusiasm from retail investors is unusual, particularly for a high-profile listing of this magnitude. Some analysts believe the weak demand from local investors stemmed amid concerns that IPO valuation may have been fully priced, leaving little scope for potential listing gain.

Recently, IPOs with large issue sizes have experienced muted listing gains on the exchanges, as evidenced in the cases of Ola Electric Mobility, LIC, and Paytm.

Among 21 stocks that debuted in October, 17 belonged to the SME segment, while the remaining four were from the main board category, namely Hyundai Motor India, Garuda Construction and Engineering, Diffusion Engineers, and KRN Heat Exchanger and Refrigeration.

These four companies collectively raised ₹28,633 crore from investors, with Hyundai Motor accounting for the majority of this fundraising. In terms of listing, KRN Heat Exchanger made a stellar debut, as the shares debuted at ₹478.80 apiece, 117.6% higher than the IPO price of ₹220 apiece.

At current levels, the stock is trading 93.6% higher than its issue price. Diffusion Engineers and Garuda Construction and Engineering also had decent market debuts, listing 20% and 12% higher than their IPO prices, respectively.

In contrast, Hyundai Motor’s shares were listed with a 7.2% discount to their IPO price of ₹1,960.

17 SMEs make their debut

In the SME segment, 17 stocks have been listed, with the majority receiving a strong response from retail investors.

Seven out of 17 achieved subscription rates exceeding 100%. Notably, Thinking Hats Entertainment’s IPO was subscribed to 329 times, followed by Freshara Agro Exports at 224 times. Among the top performers, Sahasra Electronic Solutions shares are currently trading 152% above their issue price, while Techera Engineering India stock is trading 127% higher than its IPO price.

Retail investors are showing strong interest in the SME category, driven by the allure of high returns and the opportunity to participate in the early growth stages of these companies. This enthusiasm has also led to multiple warnings from the market regulator, SEBI.

The Draft Red Herring Prospectuses (DRHPs) of several companies indicate that the primary goals for raising funds include repaying debt, financing expansion projects, and meeting working capital requirements.

Meanwhile, six other IPOs that completed their bidding period in October are set to list between October 28 and 29. These include Waaree Energies, Deepak Builders & Engineers India, Premium Plast, Danish Power, OBSC Perfection, and United Heat Transfer.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.