An Initial Public Offering (IPO) is a process through which a private company offers its shares to the public for the first time by listing them on a stock exchange. When a company goes public, it collaborates with investment banks to ensure the offering raises significant capital from public investors. IPOs are an important aspect of the stock market, with two key segments: the primary market and the secondary market. The primary market deals with fresh offerings, including new IPOs.
The IPO process involves thorough due diligence, extensive marketing, and regulatory compliance to ensure the company meets all requirements set by authorities like the Securities and Exchange Board of India (SEBI). The people who purchase shares in an IPO include both retail investors (individuals) and institutional investors, while the sellers are typically the company’s promoters and early investors.
What are Upcoming IPOs?
Upcoming IPOs refer to the public offerings of companies that have filed their Draft Red Herring Prospectus (DRHP) and are expected to open in the upcoming weeks or months. Staying updated on these upcoming IPOs is crucial because it helps investors:
- Develop a strong IPO investment strategy by researching the companies and understanding market sentiment.
- Monitor market trends to gauge investor interest in various sectors, which can enhance an investor’s understanding of the broader stock market and help time investments.
Who Can Invest in an IPO?
SEBI permits four categories of investors to bid during an IPO:
- Qualified Institutional Investors (QIIs): These include large institutions like commercial banks, mutual funds, and foreign portfolio investors. They are required to lock their investments for 90 days to minimize market volatility.
- Anchor Investors: A subset of QIIs, anchor investors are large entities with assets over ₹10 crores. They can purchase up to 60% of the shares reserved for institutional investors.
- Retail Investors: Individuals can invest up to ₹2 lakh in each IPO. A minimum of 35% of the issue is reserved for them, and if oversubscribed, every retail investor is guaranteed at least one lot of shares, often allocated through a lottery.
- High-Net-Worth Individuals (HNIs) and Non-Institutional Investors (NIIs): HNIs invest between ₹2 lakh and ₹5 lakh, while NIIs invest more than ₹2 lakh. Unlike QIIs, NIIs are not required to register with SEBI.
How to Apply for an IPO?
The process to apply for an IPO is simple and can be done online through platforms like Angel One. Here’s a step-by-step guide:
- Log in to your Angel One account and go to the IPO section.
- Select the IPO you wish to invest in.
- Review the IPO details, including investment limits and company information.
- Click “Apply Now” and enter the number of lots and bid price, along with your UPI ID.
- Confirm your application and approve the payment request on your UPI app.
Alternatively, you can apply through your bank account using ASBA (Application Supported by Blocked Amount), which blocks the necessary funds without spending them until your application is processed.
Key Pre-requisites for Applying to an IPO
To apply for an IPO in India, you need:
- Indian citizenship
- PAN card
- Demat account (necessary to hold the shares once allotted)
Additionally, while a trading account is not mandatory for applying to an IPO, you will need one if you plan to sell the shares later.
How to Increase Your Chances of IPO Allotment?
To boost your chances of getting an IPO allotment:
- Apply from multiple demat accounts.
- If there’s a price band, consider bidding at the highest price within the range.
- Apply on time, preferably before the final day at 5 PM.
- If the company has a parent company, consider applying through the ‘Shareholder’ category to increase your chances.
Top Upcoming IPOs in 2025
Several exciting companies are gearing up for IPOs in 2025. Here’s a list of some of the most anticipated ones:
- Reliance Jio
- Sector: Telecom & Digital Services
- Expected Valuation: ₹9.3 trillion
- Key Highlights: With a dominant market share and innovative digital services, Jio’s IPO is one of the most awaited offerings in India’s telecom and digital space.
- Tata Passenger Electric Mobility (TPEML)
- Sector: Electric Vehicles (EV)
- Valuation: $1-2 billion
- Key Highlights: With models like Nexon EV and Tiago EV, Tata’s EV arm plans to expand production and take advantage of India’s booming electric vehicle market.
- Imagine Marketing (boAt)
- Sector: Consumer Electronics
- Valuation: ₹2,000 crore
- Key Highlights: Known for its affordable audio products like smartwatches and earphones, boAt aims to grow further and tap into global markets with its IPO.
- Puranik Builders
- Sector: Real Estate
- Valuation: ₹510 crore
- Key Highlights: A prominent real estate developer with a strong presence in Mumbai and Pune, this IPO will fund ongoing projects and expansion.
- FabIndia
- Sector: Retail & Lifestyle
- Valuation: ₹500 crore
- Key Highlights: The lifestyle brand backed by Azim Premji’s Wipro is planning to go public to support its expansion in both offline and online retail.
- Tata Play
- Sector: Satellite Television
- Valuation: Undisclosed
- Key Highlights: The leading satellite TV operator in India plans to go public with an IPO to fund service improvements and expansion.
- Survival Technologies
- Sector: Chemical Manufacturing & Research
- Valuation: Undisclosed
- Key Highlights: Specializing in contract research and manufacturing, Survival Technologies aims to expand its footprint and fund R&D through its IPO.
- PharmEasy
- Sector: Digital Healthcare
- Valuation: ₹6,250 crore
- Key Highlights: The leading healthcare platform is raising funds to enhance its digital offerings and grow its presence in the online healthcare market.
- Hexagon Nutrition
- Sector: Nutrition & Food Fortification
- Valuation: Undisclosed
- Key Highlights: Focused on therapeutic and clinical nutrition, Hexagon plans to combat malnutrition and expand its product offerings with the proceeds from its IPO.
- Inspiria Enterprises
- Sector: Enterprise Solutions
- Valuation: ₹800 crore
- Key Highlights: With a focus on digital transformation, Inspiria Enterprises is looking to go public to support its growing demand for cross-vertical solutions.
- Sahajanand Medical Technologies
- Sector: Medical Devices
- Valuation: ₹1,500 crore
- Key Highlights: Specializing in vascular products, Sahajanand Medical aims to use IPO proceeds to expand production and innovation in the healthcare sector.
- Fincare Small Finance Bank
- Sector: Banking & Financial Services
- Valuation: ₹1,330 crore
- Key Highlights: Focused on financial inclusion, Fincare Small Finance Bank aims to raise capital to fuel its growth in underserved markets.
- Skanray Technologies
- Sector: Medical Device Manufacturing
- Valuation: ₹400 crore
- Key Highlights: A leading manufacturer of medical devices, Skanray plans to use the proceeds from its IPO to support product innovation and market expansion.
- Penna Cement
- Sector: Cement Manufacturing
- Valuation: ₹1,550 crore
- Key Highlights: Based in Hyderabad, Penna Cement is raising funds for capacity expansion and debt reduction to strengthen its position in South India and nationwide.
- Oravel Stays (OYO)
- Sector: Hospitality
- Valuation: ₹8,430 crore
- Key Highlights: India’s largest hospitality chain is planning an IPO to fund its global expansion and improve operations.
Conclusion
Investing in IPOs offers exciting opportunities, but it’s important to approach them with due diligence. By keeping an eye on upcoming IPOs and understanding the detailed process of investment, investors can make more informed decisions and potentially benefit from the growth of these companies. The IPOs slated for 2025, from Reliance Jio to Tata Play, promise to offer great investment prospects for the future.
