The filing of DRHPs by numerous companies with SEBI suggests that the IPO frenzy is unlikely to subside anytime soon. According to market experts, a record 15 mainboard IPO DRHPs were filed in just one day (September 30). This marks the highest number of DRHP filings in a single day.
“The surge in DRHP (Draft Red Herring Prospectus) filings on September 30 is also because audited financials for the quarter ending March 31 are valid only until September 30,” said Dharmesh Mehta, MD & CEO of DAM Capital.
The previous monthly record for Draft Red Herring Prospectus (DRHP) filings was in September 2010, when 34 companies submitted their documents, according to data from the Prime Database. In August 2021, 27 companies filed, while September 2007 saw 26 filings. There were two other instances – March 2010 and September 2021 – when 22 companies filed for IPO drafts in a month.
The rush among companies to tap the IPO market is on account of the buoyant secondary markets and strong investor demand.
“Fund flows from domestic institutions and retail investors into primary markets remain strong, while foreign institutional investors, though moderate in the secondary market, have been aggressive in the primary market,” said Mehta.
The 15 companies that filed on September 30 include Sambhv Steel Tubes, Jaro Institute of Technology, Viney Corporation, Scoda Tubes, Dev Accelerator, Globe Civil Projects, Ajax Engineering, Rahee Infratech, VMS TMT, Prostarm Info Systems, All Time Plastics, Vikran Engineering, Varindera Constructions, and Aditya Infotech.
A total of 120 companies have filed DRHPs in the first nine months of 2024, compared to 112 in 2023, 89 in 2022 and 126 in 2021.
Investment banker Ravi Sardana said Indian corporates are optimistic about growth and are looking to expand capacity or engage in strategic acquisitions.
“The combination of strong business prospects, a healthy equity capital market outlook, sustained domestic liquidity, and improved foreign inflows is driving many companies to reassess their IPO plans and timing,” he said.
So far in 2024, 62 companies have raised Rs 64,485 crore through IPOs, compared to Rs 49,436 crore raised by 57 companies in 2023, according to primedatabase.com.
Upcoming IPOs
All Time Plastics IPO
All Time Plastics intends to raise capital via a mix of new issue of equity shares worth up to Rs 350 crore and an offer-for-sale (OFS) of a maximum of 5,250,000 equity shares.
The company plans to use the net proceeds raised for (i) repaying a portion or all of the specific outstanding borrowings totalling Rs 120 crore, (ii) acquiring equipment and machinery for the upcoming Manekpur Facility, with an allocation of Rs 133.73 crore, (iii) and the remaining amount for general corporate purposes.
As of fiscal 2023, All Time Plastics is the second biggest B2B player in India’s plastic consumerware sector in terms of revenue. According to the Technopak Report, the company has more than 13 years of experience in producing plastic consumer items intended for everyday home use. With time, the business has developed a speciality in white-label manufacturing, creating premium goods for clients to sell under its brands. Under the exclusive brand “All Time Branded Products,” it also advertises its own line.
The issue’s book-running lead managers are DAM Capital Advisors Ltd and Intensive Fiscal Services Private Ltd.
Scoda Tubes IPO
Scoda Tubes plans to issue new equity shares worth up to Rs 275 crore. The company intends to use the funds raised from the fresh issue for expanding the production capacity of seamless and welded tubes and pipes, meeting the additional working capital needs, and general corporate purposes.
The firm is an Indian maker of stainless steel pipes and tubes with more than 14 years of expertise. Under five product lines, namely: (i) stainless steel seamless pipes; (ii) stainless steel seamless tubes; (iii) stainless steel seamless “U” tubes; (iv) stainless steel instrumentation tubes; and (v) stainless steel welded tubes and “U” tubes, the products are broadly categorised into: (i) seamless tubes/pipes; and (ii) welded tubes and pipes.
The company’s promoters, Samarth Patel, Jagrutkumar Patel, Ravi Patel, Saurabh Patel, and Vipulkumar Patel, have years of expertise in the seamless and welded stainless steel tube and pipe sector.
The issue’s lone book-running lead manager is Monarch Networth Capital.
Dev Accelerator IPO
Dev Accelerator is looking to raise funds by issuing up to 24,700,000 equity shares with a face value of Rs 2 each.
The company intends to use the proceeds to finance various objectives, including capital expenditure for outfitting new centres and for security deposits of the new centres; full or partial repayment of certain borrowings, including the redemption of non-convertible debentures issued by the company; and for general corporate purposes.
According to a JLL report, DevX is among the biggest flex space operators in Tier-2 cities in terms of operational flex stock. The company has a presence in 15 Tier-1 and Tier-2 submarkets in India and specialises in providing businesses with comprehensive built-to-suit managed office solutions. From locating office spaces to creating premises, sourcing designs, designing technological solutions, and offering full asset management, the organisation offers comprehensive services. With 25 centres spread across 11 Indian cities, the organisation served over 230 clients as of August 31, 2024.
The issue’s sole book-running lead manager is Pantomath Capital Advisors Private Ltd.
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