Interesting days ahead for primary market
The year 2023 has so far seen six companies reach the primary market to raise funds, of which the Nexus Select Trust is one of the REIT issues.
The monthly IPO-only scorecard on the main board looks weak given India’s flexible offering. Since the secondary market underperformed in the first three months, companies may have put their fundraising plans on hold in the interest of better timing and market conditions.
Besides, the performance of some 2022 IPOs, especially the Life Insurance Company of India, could have turned sentiment sour. But this has never dampened the enthusiasm of small and medium-sized companies, who continue to mobilize the capital markets to raise funds. As many as 56 companies have hit the BSE and NSE Small and Medium Enterprises Exchange in the past six months.
With the big conglomerates charging, the core market on BSE and NSE motherboards is set to remain vibrant and regain its charm. Among the big companies are the Tata and TVS groups that plan to tap the capital market after several years.
Tata Play, Tata Tech
The Tata Group, which hasn’t hit the primary market since 2004 (TCS was the last IPO), is set to launch two IPOs. Tata Play, widely known as Tata Sky earlier, recently received a SEBI nod from market regulator to launch its IPO. The company may be looking to raise Rs 3,000 crore consisting of a new issue and offer for sale (OFS), according to market sources.
Another Tata stable – Tata Technologies – has submitted draft papers to the Securities and Exchange Board of India and is awaiting its approval to launch the IPO. 9.57 crore share by Tata Motors and sale to shareholders Alpha TC Holdings Pte. Ltd and Tata Capital Growth Fund I. SEBI, in fact, sent its response to the DRHP on May 11th.
TVS Supply Chain Solutions
Almost three decades later, a company from TVS Group – TVS Supply Chain Solutions – will enter the capital market. Its last release was that of TVS Electronics back in 1994. Although last year it itself filed preliminary papers and received approval from SEBI, it had to delay the plans due to a “volatile market situation”.
As the SEBI approval period lapsed, TVS Supply Chain Solutions re-drafted the offer documents but to a smaller size. As per revised DRHP, it plans to raise up to Rs. 750 crore through new issue of equity shares and OFS through two crore shares. It had earlier planned to raise up to ₹2,000 crore through the new issue and submitted draft papers in February 2022.
The long-awaited Jio Financial
Besides, Reliance Industries, the largest Indian group, will see another stock listing on the stock exchanges. RIL has received approval from shareholders, secured creditors and unsecured creditors to separate Reliance Strategic Investments (RSIL) from Reliance Industries (RIL), paving the way for the listing of Jio Financial Services.
Each Reliance shareholder will receive one share of Jio Financial.
Besides, a large number of companies like National Stock Exchange, Go Digit Insurance, JSW Infrastructure, Fincare Small Finance Bank, Snapdeal, and Oyo have plans to tap into the capital market. There is no doubt that these big names will keep the primary markets buzzing with activity. However, for that to happen, the secondary market must maintain recent gains until the end of the year.