In 2024, India's Initial Public Offering (IPO) market experienced a remarkable resurgence, emerging as a critical driver of wealth creation and a barometer of investor sentiment. Buoyed by robust economic growth, favourable liquidity conditions, and strong retail participation, the year saw several high-profile companies debut on the stock exchanges. These IPOs reinforced the growing appetite for new-age businesses and established enterprises among institutional and retail investors alike.
Notable IPOs of 2024:
- Swiggy: Raised ₹11,327 crore ($1.4 billion) with a debut at ₹420 (7.7% premium), closing at ₹455.95.
- Vishal Mega Mart: Valued at $943 million, its IPO attracted bids worth $19 billion.
- MobiKwik: Raised $67 million, saw its shares surge 86% on listing, and achieved a valuation of $474 million.
- Bajaj Housing Finance: Oversubscribed by 64x, the shares doubled on listing day. One of the most successful mid-cap IPOs of 2024.
- NTPC Green Energy: Raised $1.2 billion, and its shares surged 14% on debut.
- Jungle Camps India: Debuted at a 90% premium, underscoring investor appetite for growth-stage enterprises.
- Property Share REIT: India’s first REIT focused on fractional property ownership saw strong demand from both retail and institutional investors.
- Suraksha Diagnostics: The healthcare IPO was fully subscribed, reflecting strong interest in the sector.
- Hyundai Motor India: India’s largest-ever IPO, raising $3.3 billion, but it faced headwinds with a 4% drop on listing day.
IPOs became a major vehicle for wealth creation for diverse stakeholders—employees (via ESOPs), HNI investors, and retail investors. Here’s a closer look at how IPOs shaped wealth in 2024.
Employees – ESOP Windfalls
For employees of companies that went public, the year was indeed a landmark juncture for wealth creation. Employees of companies like Swiggy, NTPC Green Energy, Bajaj Housing Finance, and MobiKwik unlocked significant gains when their firms listed, proving that Employee Stock Ownership Plans (ESOPs) were a vital instrument for wealth generation in 2024.
HNI Investors – Pre-IPO Deals & HNI Quotas
For HNIs, pre-IPO deals emerged as an avenue of high interest, especially in high-growth startups. Deals in companies like Swiggy, Property Share REIT, and Carraro India saw strong gains, with early investors booking double-digit returns on listing day. As valuation concerns and profitability questions grew, HNIs became more selective in backing early-stage companies. Instead of chasing every pre-IPO opportunity, HNIs looked for companies with clear cash flow visibility that captured HNI interest as they offer a blend of stability and upside potential, opting for quality over quantity.
HNI quota of IPO listings were oversubscribed until the later half of the year. HNI quotas of IPOs in August and September saw an average oversubscription of 128 times and 180 times respectively. However, later on, HNI demand for IPOs like Hyundai India, Niva Bupa Health, and Godavari Biorefineries failed to hit full subscription, with some companies barely scraping single-digit participation. Cooling markets, collapsing grey market premiums, and rising funding costs significantly dampened HNI interest in IPOs towards the later half of the year.
Retail Investors – IPO as an opportunity for Wealth Creation
The IPO boom in 2024 saw a surge in retail investor participation, driven by the rise of mobile trading apps like Zerodha, Groww, and Paytm Money that democratized access, and fintech platforms that provided data-driven insights, enabling retail investors to make better-informed decisions and approach IPO investments with greater confidence.
In addition to the ‘Digital India’ push, the allure of strong listing gains played a key role. Retail investors were drawn to diversification opportunities, trusted brands, and fair valuations, especially in sectors like fintech, housing finance, and real estate. This combination of familiarity, growth potential, and accessible technology fueled retail enthusiasm for IPOs.
Despite the positive momentum, the IPO market faced challenges that underscored the complexities of public market participation.
For starters, overvaluation concerns and aggressive pricing strategies led to post-listing underperformance for some IPOs. A notable example is Hyundai Motor India, whose shares declined 4% on debut, falling short of investor expectations. The situation was further exacerbated by rising interest rates in the U.S. and geopolitical uncertainties, dampening foreign institutional investor (FII) flows and impacting demand for certain IPOs. Moreover, companies had to contend with changes in the regulatory framework, including stricter compliance and disclosure norms, which added to the complexity of the IPO process.
The IPO resurgence of 2024 is a strong indicator of market behaviour. With increased transparency, sophisticated tech tools, and heightened retail participation, India’s equity markets solidified their position as an indispensable playing field for wealth creation.
As we look over the horizon of 2024, it is evident that sectors like deep tech, fintech, and renewable energy are poised to drive the next wave of pre-IPO investment opportunities. Understanding valuation discipline, investor sentiment, and regulatory compliance will be essential for HNIs, retail investors, and employees alike to seize these opportunities.
