It was a record year for companies going public in India in 2017, and 2018 is set to be another strong year, with a slew of companies looking to hit the capital market with their initial public offerings.
In 2017, a total of 36 companies raised Rs 67,147.44 crore via IPOs, the highest in the last few years, according to Prime Database, which tracks primary activity. This year, over January and February six companies have cumulatively raised Rs 3,559.45 crore and the pace is only picking up.
On Thursday, ICICI Securities, the equity broking unit of ICICI Bank, the country's largest private sector lender, set the ball rolling for its initial public offering. ICICI Bank is selling 7.72 crore shares or 24 per cent stake in ICICI Securities to raise around Rs 4,000 crore.
The price band for the issue, which will open for subscription on March 22 and close on March 26, has been set in the Rs 519-520 per share range. A part of the issue (38.62 lakh equity shares) will be reserved for shareholders of ICICI Bank.
The issue of ICICI Securities will be the third ICICI Bank unit to go public in as many years. The first issue was that of ICICI Prudential Life Insurance in 2016, which raised Rs 6,000 crore, while Rs 5,700 crore was raised through the IPO of ICICI Lombard General Insurance last year.
Other than ICICI Securities, there are several public offers lined up this month. Bandhan Bank's Rs 4,473 crore issue opened for subscription on Thursday. The issue includes fresh issue of shares as well as offer for sale by existing shareholders – World Bank-controlled International Finance Corporation (IFC) and IFC FIG Investment Co.
A few state-owned firms are also going public this month. This includes, Bharat Dynamics, a public sector undertaking, which manufactures surface to air missiles and anti-tank guided missiles among other defence equipment. The other PSU going public is Mishra Dhatu Nigam, which makes special steel and titanium alloys in India. Both the issues are offer for sale, through which the government is paring some of its stake.
Another state-owned firm Hindustan Aeronautics will launch its IPO on March 16. The large defence PSU has set a price band of Rs 1,215-1,240 per share for the issue, which is also a pure offer for sale by the government.
The total cumulative fund raising from IPOs in March will account for over Rs 13,800 crore.
And there is more to come in the months ahead.
HDFC Asset Management, the mutual fund arm of HDFC Ltd, India's largest mortgage lender, also filed its draft papers with the Securities and Exchange Board of India to go public. The 2.55 crore share issue, will also be an offer for sale, where by promoters including HDFC and Standard Life Investments will be reducing their stakes in the company.
Barbeque-Nation Hospitality, CMS Info Systems, Indian Renewable Energy Development Agency, Krishna Institute of Medical Sciences, Lemon Tree Hotels, Prince Pipes and Reliance General Insurance are some of the other companies that have received regulatory approval to go public, according to Prime Database.