Economy News Details
New Delhi: Despite of financial meltdown that may have resulted many to stay away from the primary capital market, the average size of IPOs grew by nearly half in 2008 over 2007 and thus bring down the number of IPOs to about one-third, the Economic Survey said on July 2.
The primary capital market received a setback in 2008 after posting strong growth during 2006 and 2007. The number of new issues fell sharply in 2008 and the total number of initial public offers (IPO) were only 37 in 2008 as compared to that of 100 in 2007, the Survey said. The amount garnered by IPOs stood at Rs 18,393 crore and was lower by 45.8 per cent during 2008, However, the mean IPO size shot up from Rs 339 crore in 2007 to Rs 497 crore in 2008, it said.
Besides the primary market, the appetite of Indian business houses for fresh capital also dipped in 2008 as the total amount of capital raised by equity issues, including IPO and rights issues, dipped nearly 16 per cent.
So far in 2009, only three companies came out with IPOs. In February two companies - EdServ Softsystems and Gemini Engi-Fab - announced their intention to come out with IPO. EdServ raised over Rs 20 crore through the IPO while Gemini Engi-Fab withdrew its issue even before it started. However, the IPO of Mahindra Holidays & Resorts, which came last month, got subscribed nearly 110 per cent, according to data available on the National Stock Exchange.
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