September was supposed to be a blockbuster month for the Indian IPO market. With more than 25 companies raising over Rs 13,000 crore through mainboard IPOs, it marked one of the busiest months for primary markets in three decades. Yet when it came to actual listing day performance, the excitement quickly fizzled out.
Strong Subscriptions, Weak Debuts
Despite oversubscription across many offerings, most IPOs failed to reward investors on listing. Out of the 17 mainboard IPOs that hit the market, eight opened below issue price while another eight delivered only muted single-digit gains. The one true outlier was Urban Co Ltd, which surprised the market with a strong 60 percent premium debut.
On the flip side, Jaro Institute of Technology Management slipped 16 percent on listing, while Ganesh Consumer Products and Solarworld Energy dropped 9 and 8 percent respectively. Companies like Saatvik Green Energy, Ivalue Infosolutions and VMS TMT also saw declines of nearly 5 percent below issue price, underlining how fragile market sentiment currently is.
Analysts Explain the Disconnect
Experts believe the mismatch between strong subscription demand and poor post-listing performance comes down to muted earnings growth and subdued investor confidence. Many IPOs priced aggressively during the frenzy are now facing valuation corrections once they hit the secondary market. Even high-profile issues such as Vikram Solar and certain IT sector names, despite strong fundamentals, are trading below their issue price. Analysts point out that subscription hype is fading quickly as broader market conditions weigh heavily on new entrants.
Record Activity in SME IPOs
The small and medium enterprise (SME) segment saw record-breaking activity, with 53 IPOs raising Rs 2,309 crore in a single month — the highest ever in both deal count and funds raised. However, the performance was uneven. Of the 36 SME IPOs that listed, 15 opened in the red, nine were flat, and only 12 delivered impressive listing gains ranging from 20 to 100 percent.
Some of the sharpest underperformers included NIS Management, which tanked 28 percent on debut, while Sugs Lloyd and JD Cables each dropped 24 percent. Oval Projects Engineering fell 19 percent, and Vashishtha Luxury Fashion slipped 16 percent, proving that even in a booming IPO pipeline, risks remain high.
What Investors Should Keep in Mind
Market experts caution that IPOs should not be treated as guaranteed profit opportunities. Narinder Wadhwa, MD and CEO of SKI Capital Services, advised investors to focus on fundamentals, promoter credibility, and long-term track record rather than just chasing quick listing gains.
The IPO market may remain active in the coming months, but with valuations correcting and market sentiment shaky, investors will need to be more selective than ever.
Follow You Finance on Instagram and Facebook for real-time IPO updates, sharp insights, and expert takes on the markets.
