IPO boom gives pause for thought

Despite mixed post-listing performance and volatility in the secondary market, the boom in IPOs continues unabated this year. But cracks are beginning to appear

- SUNDAR SETHURAMAN

Primary market performance hinges on how well the secondary market does in a particular year. But this year has been an exception. India's primary market is in the middle of an unprecedented boom, even as the secondary markets grapple with one headwind after another, from slowing corporate earnings to tariffs imposed by US President Donald Trump.

September alone saw more than two dozen companies go public — the most in a single month since January 1997. The first whole week of October set a fresh record, with companies mobilising over ₹30,000 crore, the highest-ever weekly mopup.

Nearly 200 companies have filed draft initial public offering (IPO) papers this year, setting the stage for an action-packed 2025.

One explanation for this boom is that investors found better returns in most new issuances than in the already listed ones. However, cracks are starting to appear.

According to IPO-tracking portal Chittorgarh.com, more than a third — or 29 out of 83 mainboard IPOs this year — ended their debut sessions in the red, with losses of up to 35 per cent. And more than half of these listings have happened since September. Four of them tanked more than 20 per cent on listing day. The average debut-day gain has fallen to 9 per cent in 2025 from 30 per cent a year ago.

Despite mixed post-listing performance and volatility in the secondary market, the IPO boom continues unabated. So far this calendar year, nearly ₹1.2 trillion has been raised, and the final haul is likely to surpass last year’s record ₹1.6 trillion.

Recently concluded issues, such as Tata Capital and LG Electronics India, have already set the tone for more big-ticket offerings. Several large IPOs are in the pipeline, including those of ICICI Prudential AMC, Lenskart, PhonePe, PhysicsWallah, Meesho, and Pine Labs.