More tier-II companies are likely to drive IPO boom in 2025

After a year of record fundraising through initial public offerings (IPO), merchant bankers are expecting domestic IPOs to gather more steam in 2025, with increasing funding demand from tier-II companies.

- Abhinaba Saha

"Our estimates suggest around $35 billion (worth of) IPOs (planned) in the current calendar year," Kaushal Shah, managing director and head of equity capital markets at Kotak Mahindra Capital Co. said at the Mint BFSI Summit.

Last year, over 300 companies across the main board and small and micro enterprise (SME) categories raised around $18.5 billion through IPOs, double the amount raised in 2023. Experts are also excited about the diversity of the current pipeline of IPOs.

Indian IPOs have been dominated by financial services companies, followed by new-age players like Swiggy and Zomato, real estate and specialty chemicals companies.

"But last year, not only new-age companies, but also infrastructure, industrial and manufacturing companies were there (for fundraising), and we are expecting this to continue," Shah added.