In FY 23 the fundraising raised more than halved due to initial public offers IPO, which had a record high of 1,11, 547 crore in FY 22, with LIC alone accounting for 39 per cent of the total funds raised by corporates this year.
The IPO fundraising would have been just Rs 31,559 crore without LIC alone raising Rs 20,557 crore or a huge 39 per cent of the amount raised in 2022 -- 23. Pranav Haldea, Managing Director at PRIME Database GroupDatabase Group, said the amount raised in 2022 -- 23 is still the third highest fund raise.
A total of 37 main board IPOs hit the market in FY 23 against 53 IPOs in FY 22.
LIC was the largest Indian IPO ever. The average IPO deal size was high as per the PRIME Database, followed by Delhivery Rs 5,235 crore and Global Health Rs 2,206 crore.
As many as 25 out of 37 IPOs came in just 3 months of the year May, November and December, showing the volatile conditions that are prevalent through most of the year that are not conducive for IPO activity, Haldea said.
In fact, the fourth quarter of FY 23 saw the lowest amount raised in the last 9 years, according to the PRIME Database. The response from the public was moderate, according to primedatabase.com. Of the 36 IPOs currently available, 11 IPOs received a mega response of more than 10 times, of which 2 IPOs were more than 50 times oversubscribed, while 7 IPOs were oversubscribed by more than 3 times.
The balance of 18 IPOs was oversubscribed between 1 and 3 times. 11 IPOs received more than 10 times the response of the new HNI segment of Rs 2 -- 10 lakh.
Retail demand was moderated. The average number of applications from retail dropped to just 5.64 lakh, compared to 13.32 lakh in FY 22 and 12.73 lakh in FY 21.
The highest number of applications from retail was received by LIC 32.76 lakh followed by Harsha Engineers 23.86 lakh and Campus Activewear 17.27 lakh. The amount of shares applied for by retail by value Rs 41,671 crore was 20 per cent less than the total IPO mobilisation in 2021 -- 22 showing the lower level of enthusiasm from retail during the period. The total allocation to retail was Rs 14,308 crore, which was 28 per cent of the total IPO mobilisation, up from 20 per cent in 2021 -- 22 According to Haldea, IPO response was muted by moderate listing performance. The closing price on listing date was down to 9.74 per cent, compared to 32.59 per cent in FY 22 and 35.68 per cent in FY 21. 16 of the 36 IPOs that have been listed thus far gave a return of over 10 per cent. DCX Systems provided a stupendous return of 49 per cent, followed by Harsha Engineers 47 per cent and Electronics Mart 43 per cent 21 of the 36 IPOs are trading above the issue price closing price of 24 March, 2023 Anchor investors collectively subscribed to 32 per cent of the total issue amount. Domestic mutual funds played a more prominent role than FPIs as anchor investors with their subscription amount at 17 per cent of the issue amount, with FPIs at 11 percent. As a whole, Anchors Investors subscribed to 59 per cent of the total issue amount. On an overall basis, the FPIs, as anchors and QIB, subscribed to 21 per cent of the issue amount, which was slightly lower than the MFs at 23 per cent.