CONFIDENCE IN ECONOMIC OUTLOOK
Public listings are often aimed at raising funds for expansion, and analysts say a robust IPO pipeline signals growing confidence in India’s economic outlook.
The World Bank projects India’s gross domestic product (GDP) will grow by 6.3 per cent in the current financial year.
Observers said this suggests India could maintain its position as the world’s fastest-growing major economy.
But not all market analysts share the same optimism, especially retail investors.
In recent years, many middle-class Indians have flocked to equities in search of high returns as markets rallied.
However, that enthusiasm has waned.
Ajay Tyagi, head of equities at UTI Asset Management, noted that valuations and investor demand for public listings have yet to return to their previous highs.
“For IPOs to go back to where they were in 2023 and 2024, you have to see the excitement in the equity markets go back once again,” he said.
“I think we are some time away from that. There has been a let off in this excitement from the retail investors and that’s why you’re seeing the retail participation, while still strong, in terms of magnitude it is coming down.”
There is also a lot of uncertainty still on the horizon, said experts.
Such risks could swiftly stall the IPO market’s revival, as investors closely watch whether a potential US-India trade deal can avert crippling US tariffs.
Emkay Global Financial Services’ Singh said: “The tariff situation, the belief is India has got it under control and that’s why markets are stable and doing okay, but it can go the other way around as well.”
Read the full article here
