If macro conditions hold, IPOs will top 2024's record tally

Last calendar year was a record year with ₹1.6 trillion getting mobilised through initial public offerings (IPOs). The momentum has slowed this year, but Sunil Khaitan, managing director (MD) and head of India Financing Group at Goldman Sachs, believes market volatility hasn't hindered the IPO filings. In an interview with Samie Modak and Sundar Sethuraman in Mumbai, Khaitan expressed optimism that 2025 could be another exceptional year, citing growing recognition among issuers and investors of the importance of balanced pricing over short-term gains. Edited excerpts:

- Sunil Khaitan

Market volatility spiked after September. How does this impact ECM activity?

Volatility intensified recently, but ECM deals remained active through December and January. Foreign investors, while net flat on secondary markets, deployed $12 billion in primaries (IPOs/blocks) in 2024, signalling a shift toward structured opportunities. The IPO market slowed by March due to valuation mismatches and a consumption slowdown, but filings continue as issuers focus on long-term readiness. Foreign investors prioritised primary markets (IPOs/blocks) over secondary markets, deploying capital thematically.

However, valuations in small/midcap segments corrected 20 per cent, making issuers hesitant. Additionally, retail and HNI (high-net-worth individuals) participation softened due to macroeconomic uncertainty. The ecosystem is maturing—both issuers and investors now recognise the need for balanced pricing rather than optimising short-term gains.

Is the IPO pipeline strong enough to match 2024's record ₹1.6 trillion?

If macro conditions hold—RBI (Reserve Bank of India) policies, tax cuts boosting consumption, and global confidence in India—we could exceed 2024's figures. The first half of 2024 had smaller deals; this year's larger, high-quality issuers may accelerate the total once the market fully opens up. The key is balancing foreign and domestic participation while ensuring IPOs cater to long-term holders. We advise issuers to stay ready—regulatory approvals are valid for 12 months, allowing flexibility to launch when windows open.