Mumbai: Amid rising global trade tensions and lacklustre corporate earnings, Indian retail and high-net-worth investors are pouring capital into initial public offerings (IPOs) in pursuit of quick listing gains—even as risks mount.
Five IPOs that closed last week collectively received ₹2.46 trillion in bids, against a combined offer size of ₹7,008 crore, according to exchange data. That amounts to an oversubscription of about 35 times. The issues include India’s largest depository National Securities Depository Ltd (NSDL), Aditya Infotech, Sri Lotus Developers and Realty Ltd, M&B Engineering Ltd, and Laxmi India Finance Ltd.
NSDL’s offering drew the most interest by value, with bids worth ₹1.15 trillion for shares worth ₹4,011.6 crore. Non-institutional investors, which include small and big high net-worth investors, investing above ₹2 lakh and ₹10 lakh respectively, bid for 262.7 million shares, over 35 times the 7.50 million shares available. Retail investors, applying for up to ₹2 lakh, bid for 135.5 million shares, 7.7 times the shares on offer.
Aditya Infotech saw even stronger demand. Non-institutional investors placed bids for 218.4 million shares, or 72 times the shares offered. Retail participation stood at 50.87 times, with bids for 102.8 million shares. Aditya Infotech’s issue closed on 31 July and is scheduled to list on 5 August. NSDL is expected to follow a day later.
“The motive for the overwhelming subscription seen among the HNIs and retail category is largely flipping, which is especially risky if the issue lists at a discount to the offer price,” said Nilesh Shah, managing director at Kotak Mahindra Asset Management Co.
Flipping—subscribing to IPOs purely to sell on listing day for a quick gain—can backfire if a stock debuts flat or below the issue price. Shah cautioned that investors chasing quick returns without understanding fundamentals risk disappointment.
Over the past four months, IPO activity has picked up significantly. From 7 April through 1 August, 23 IPOs were listed, delivering an average listing gain of 10.3%, according to data from Equentis. Seventeen of these IPOs closed above their issue price on debut, while six listed at a discount.
The best performer, GNG Electronics, gained 49.8% on its listing last Wednesday, debuting at ₹355 per share. Arisinfra Solutions, on the other hand, opened 7.7% below its issue price of ₹222 on 25 June.
The rebound in IPO activity follows a period of market correction. Between 27 September 2024 and March 2025, India’s benchmark indices fell 16.4%, from a high of 26,277.35 to a low of 21,974.45. The market subsequently recovered, with the Nifty gaining 18% from 7 April to reach 25,669.35 on 30 June.
Since then, however, sentiment has turned cautious. The benchmark Nifty 50 index fell 4.3% to 24,565.35 by Friday, after President Donald Trump announced a surprise 25% tariff on goods imported from India, and as corporate earnings for the first quarter of FY25 disappointed. Consolidated earnings of 1,045 companies rose just 3.11% year-on-year to ₹2.77 trillion, according to Capitaline data.
