Blockbuster IPOs, lacklustre returns: 7 of 11 trade below issue price
Recent data shows that a majority of large IPOs in India since 2021 are currently trading below their issue prices, despite being marketed as 'blockbuster' offerings. Companies like Swiggy and Paytm have seen significant declines, while only a few have provided strong returns.
Why it matters
This highlights the risks associated with high-profile IPOs and the volatility of the Indian stock market for retail and institutional investors.
A 'blockbuster' tag attached to mega IPOs has not always translated into blockbuster returns for investors over the years. The post-listing story, in some cases, has been less rewarding. Of the 11 big IPOs that raised over ₹9,500 crore each through public issues since 2021, 7 are currently trading below their respective issue prices, including the most recent NSE that raised ₹22,563 crore earlier in September. These 7 companies collectively raised ₹1.05 trillion from the market via IPOs, which is now valued 15.3 per cent lower at ₹88,979 crore. Shares of quick-commerce platform Swiggy are down 35 per cent against its issue price, while Paytm parent One 97 Communication is quoting 22 per cent lower than its issue price.
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