GOING WITH THE TIDE

MARKET BUOYANCY LED TO A STELLAR SHOW BY IPOs THOUGH FUNDS RAISED WERE LOW

- NITI KIRAN

A rising tide lifts all boats, and the recent buoyancy in the stock market boosted the post-listing performance of 2019 initial public offerings (IPOs). The equity market, which was otherwise drooping since June, rose by around 14 per cent, year-to-date. This led to a stellar show by IPOs which hit the markets in 2019.

The markets are scaling all-time highs – the Sensex delivered over 3 per cent returns in September and October and close to 2 per cent in November. In December, it rose around 1 per cent. According to data compiled by Prime Database, of the 16 main-board IPOs of 2019, 15 have been listed so far. Of these, about 81 per cent are trading over 20 per cent of their respective issue prices (based on market price of December 23). This is in stark contrast to the previous two years – more than half the issues of 2018 and 2017 are in the red.

The leaders in the 2019 pack were Indian Railway Catering and Tourism Corporation (IRCTC), which is trading above 170 per cent its issue price of ₹320, and Indiamart Intermesh, which is up by 120.3 per cent. Five IPOs are trading above 50 per cent while six have risen 20-40 per cent higher than their issue prices. Stock prices of only two issues in 2019 – Sterling & Wilson Solar and Xelpmoc Design & Tech – are below the issue prices. They have declined 61.2 per cent and nearly 4 per cent, respectively.