After two record-breaking years for IPOs in India, the prospect of a prolonged issuance drought is rapidly materialising on Dalal Street—thanks to the Iran war's impact on stock market.
Potential IPO candidates now face a challenging environment characterised by heightened market volatility, which is actively denting investor appetite and severely clouding visibility on corporate valuations.
According to data compiled by Bloomberg, Indian companies have raised $1.5 billion in the current quarter from primary offerings, versus $2.3 billion raised during the same period last year.
Several companies have been forced to approach the market with downsized deal structures. Post-listing performance has also been largely lacklustre, adding to the primary market's woes: Six of the nine mainboard IPOs completed so far this year are currently trading below their offer prices.
Despite the overarching gloom, deal activity has not completely ground to a halt. A select pipeline of offerings is braving the volatility to test the waters.
