India Sees Highest IPO Funding In 13 Years

Indian companies have generated more than $2 billion through initial public offerings (IPOs) thus far in 2021, the highest level of IPO fundraising in the country since 2008.

According to Reuters, this follows a 2020 that saw companies in India raise $9.2 billion from IPOs, putting them in third place behind the U.S. and China.

The fundraising is being driven by “a flood of foreign money and unprecedented interest from mom-and-pop investors,” the news outlet reported.

Stimulus funds released in response to COVID-19 have also flown into markets such as India, with investors pumping in $6.1 billion into Indian markets in the first two months of 2021, the most among seven major Asian countries.

“If you want to be in Asia, but don’t want all your eggs in one basket, the China basket, India is the easiest option to go for. It’s large, liquid, and got a low correlation with China,” Herald van der Linde, head of Asia equity strategy at HSBC, told Reuters.

“There is a strong momentum in the IPO markets, and we are seeing an increased interest from companies across sectors looking to raise capital in the near term,” Sandip Khetan, a partner at consultancy EY in Gurugram, India, said in the Reuters story.

Khetan added that many tech-based startups in India, helped by high-profile global investors, might also go public fairly soon, generating interest from even more foreign investors.

But India isn’t the only country bracing for a deluge of IPO money. As reported last week, Russia is anticipating more than $10 billion in fundraising this year from sectors ranging from mining to retail to IT, the highest in more than a decade.

This follows an extremely busy year for IPOs, with 2020’s 480 IPOs — just on American markets — representing a 100 percent increase in initial public offerings from 2019. This year might see IPOs break even more new ground, as there were 250 public listings in the U.S. recorded by the end of February.