The Securities and Exchange Board of India (SEBI) has granted approval for five prominent companies to initiate their fundraising through initial public offerings (IPOs). This announcement was made on September 30, detailing that the firms given the green light include the retail chain Vishal Mega Mart, renewable energy company ACME Solar Holdings, packaging equipment manufacturer Mamata Machinery, automotive giant Hyundai Motor India, and the popular food delivery service Swiggy Ltd. This marks a significant development in the Indian IPO landscape and reflects growing investor interest in these sectors.
SEBI’s issuance of an observation letter on the submitted IPO drafts signifies that a company can proceed with launching its share sale within the following year from the date the letter is issued.
Also Read: Diffusion Engineers’ IPO saw significant subscription, indicating robust demand from institutional investors, which showcases the healthy appetite for new public offerings in the current market.
As per SEBI’s recent processing status, the observation letters for Swiggy Ltd and Hyundai Motor India were issued on September 24, 2024, while Vishal Mega Mart received its approval on September 25. ACME Solar Holdings and Mamata Machinery followed suit on September 27. In contrast, the draft papers of Innovision, a manpower services company, were returned by SEBI due to pending clarifications on its proposed IPO, which involves both a fresh issue valued at ₹315 crore and an offer for sale (OFS) of 11.81 lakh shares.
Overview of Upcoming IPOs
Here’s an in-depth look at the five companies gearing up to launch their IPOs:
1. Hyundai Motor India IPO
Hyundai Motor India, recognized as the Indian subsidiary of South Korea’s Hyundai Motor Company, is poised to raise an estimated ₹25,000 crore through its IPO, potentially making it the largest initial public offering in India’s history. This IPO is anticipated to hit the market in time for the Diwali festivities.
As the second-largest automobile manufacturer in India, Hyundai Motor India holds a competitive edge against rivals like Maruti Suzuki and Tata Motors. The funds raised are expected to bolster their financing capabilities in the future, although the company does not plan to directly use the IPO proceeds for its operations.
Market analysts predict that Hyundai’s IPO could lead to significant value growth and investment prospects in the developing Indian automotive market. The company reported a return on net worth (RoNW) of 23.48% for FY23, indicating a high efficiency in utilizing shareholder funds to generate profits.
Between fiscal years 2019 and 2023, the passenger vehicle (PV) sector exhibited strong growth, with a compound annual growth rate (CAGR) of 11%, driven by both increased vehicle prices and total sales volumes. Hyundai is well-positioned to capitalize on these trends due to its diverse model offerings.
2. Swiggy IPO
The Swiggy IPO will comprise a fresh equity issue valued at ₹3,750 crore coupled with an offer for sale (OFS) of 185,286,265 shares by existing shareholders. This offering is designed to attract qualified institutional buyers, anchor investors, and mutual funds, enabling early investors such as Accel, Prosus, and Tencent to partially divest their stakes.
3. Vishal Mega Mart IPO
Vishal Mega Mart, which opted for the confidential filing mechanism with SEBI in July, has received a favorable observation on September 25. Under this process, the company will submit an updated draft for public comments after addressing feedback from SEBI.
The stepwise process of filing includes a review of the confidential draft, followed by making necessary updates based on regulatory feedback, and eventually inviting public comments before filing a revised draft.
4. ACME Solar Holdings IPO
Based in Gurugram, ACME Solar Holdings has also garnered SEBI’s approval to proceed with its IPO plans. The proposed offering includes a fresh issue of shares worth ₹2,000 crore alongside an OFS amounting to ₹1,000 crore, aimed at reducing debt and fulfilling general corporate needs.
5. Mamata Machinery IPO
Mamata Machinery is gearing up for an IPO that consists entirely of an OFS of 73.82 lakh equity shares, which will be sold by its promoters. The stakeholders involved in this offering include Mahendra Patel, Nayana Patel, and Mamata Management Services LLP, among others.
The dynamic Indian IPO market is witnessing a surge, with 62 companies—including notable entrants such as Bajaj Housing Finance, Ola Electric Mobility, and Brainbees Solutions (parent company of FirstCry)—raising approximately ₹64,000 crore this year alone. This marks an impressive 29% increase compared to the ₹49,436 crore mobilized by 57 companies throughout 2023, highlighting a robust appetite for public listings in the current economic climate.
