All that glitters is not gold on the IPO street

Amid booming IPO market, caution is in the air for investors as majority of the companies that were listed in 2024 failed to retain their respective listing gains, shows the latest analysis by ETIG. Of the 81 companies in the sample that were listed on the main board in 2024 as of December 20, 48 or more than half posted 10% or higher listing gains but only 20 were able to either retain or improve upon their initial gains in subsequent trading sessions.

In addition, only 33 or over one-third of the companies posted 25% or more in listing gains and just nine of them were able to either retain or extend these gains. Also, of the 62 companies in the sample which were listed on bourses above their offer prices, 26 failed to post any gains as of December 24. The analysis does not consider the period for which these companies have been traded on bourses. That means companies which have been listed for a short period such as a week or a month may show a different trend in stock returns as time passes.

The current calendar year has been a record year for the primary market issuance helped by a buoyant secondary market for a major part of the year and a sustained participation by foreign portfolio investors (FPIs) in IPOs notwithstanding their selling spree in the secondary market over the past three months. In the current year as of December 24, FPIs invested around Rs 1.2 lakh crore in the primary market including IPO and qualitative institutional buying while they were net sellers of equities worth Rs1.1 lakh crore in the secondary market according to the data from NSDL.


This year till December 20, companies have raised Rs 1.5 lakh crore through mainboard IPOs (excluding SME platform listings) compared with nearly Rs50,000 crore in 2023. At the aggregate level, the listing day market capitalisation of companies in 2024 increased by 10% to Rs12.8 lakh crore as of December 24. Among the sample companies, Vibhor Steel Tubes clocked the highest listing gain of 179%, followed by BLS E-Services (129% gain) and Premier Energies (120%).