Are Mainboard IPOs Signaling a Rebound in Indian Markets?
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Synopsis
In May 2025, the Indian capital markets showcased a stunning recovery, especially in the mainboard IPO sector, indicating resilience amidst global uncertainties. With three consumer discretionary IPOs raising substantial capital and a shift towards fresh issuances, investor interest remains robust. But geopolitical tensions pose a looming risk. Discover the details behind this market rebound!
Key Takeaways
- Three mainboard IPOs raised over Rs 5,600 crore in May.
- Strong market debut added over Rs 20,000 crore to market capitalization.
- 93% of funds raised were through fresh issuances.
- Institutional investors dominated allocations, with QIBs receiving 67%.
- The SME segment saw six new listings and a growing market cap.
Mumbai, July 4 (NationPress) India’s capital markets experienced a remarkable resurgence in May 2025, as the mainboard IPO sector made a significant recovery following a two-month hiatus, according to data from NSE’s Market Pulse released on Friday.
This rebound, driven by favorable macroeconomic indicators and robust investor engagement, underscores the strength of Indian markets amidst global uncertainties.
In May, three mainboard IPOs were introduced, collectively generating over Rs 5,600 crore, with an average issue size of approximately Rs 1,750 crore.
Notably, all IPOs originated from the consumer discretionary sector, continuing a trend from FY25 where this sector contributed 40 percent of the total capital raised via IPOs.
Each of the three IPOs had a strong market debut, collectively enhancing the overall market capitalization by over Rs 20,000 crore.
Another significant trend was the nature of the capital raised, with around 93 percent sourced from fresh issuances, a substantial increase from just 35 percent in FY24, indicating a shift in focus towards raising new capital rather than liquidating existing shares.
Investor enthusiasm remained high, particularly among institutional investors, with Qualified Institutional Buyers (QIBs) securing 67 percent of allocations. Retail Individual Investors (RIIs) and Non-Institutional Investors (NIIs) received 21 percent and 12 percent respectively.
The SME sector also maintained its upward trajectory, with six new companies listed on the NSE Emerge platform in May.
The total market capitalization in the SME segment surpassed Rs 2 lakh crore, adding Rs 12,000 crore during the month.
In terms of overall market capital fundraising, follow-on equity offerings dropped to Rs 3,750 crore in May, down from Rs 49,000 crore in April.
Meanwhile, the debt market remained robust, with issuances amounting to Rs 1.3 lakh crore, where Commercial Papers (CPs) contributed 54 percent and Non-Convertible Debentures (NCDs) accounted for the remaining 46 percent.
This renewed market activity was bolstered by multiple macroeconomic advantages, including declining inflation, a record surplus transfer by the RBI, and positive trade relations with major economies such as the UK, US, and the EU.
However, the report also highlighted the potential risks to future market sentiment due to ongoing geopolitical tensions in West Asia.
Point of View
It's vital to recognize the resilience of India's capital markets in the face of global uncertainties. The strong performance of IPOs in May reflects the underlying strength of our economy and investor confidence. However, we must remain cautious of external factors that could impact market sentiment in the future.
NationPress
26/07/2025
Frequently Asked Questions
What contributed to the recent IPO revival in India?
The revival was driven by improving macroeconomic conditions, strong investor interest, and a focus on raising new capital through fresh issuances.
Which sectors dominated the IPOs launched in May?
All three IPOs launched in May were from the consumer discretionary sector, continuing a trend from FY25.
How did institutional investors participate in the recent IPOs?
Qualified Institutional Buyers (QIBs) received 67 percent of the IPO allocations, indicating strong interest from institutional investors.
What risks could affect the future market sentiment?
Ongoing geopolitical tensions in West Asia could pose risks to future market sentiment, despite current positive trends.
How did the SME segment perform in May 2025?
The SME segment continued to grow, with six new companies getting listed and a total market capitalization surpassing Rs 2 lakh crore.
