Bear market impact hits India Inc: IPOs worth ₹66,000 cr on hold by 44 companies; will the good times return?

The persistent volatility in the stock market has dampened investors' appetitive so much that 44 companies, including National Securities Depository Ltd. (NSDL), Ather Energy, and JSW Cement, are holding back their initial public offering (IPO) plans, till good time returns. Among other big-ticket IPOs that have put on hold are SK Finance, Avanse Financial Services, Manjushree Technopack, Schloss Bangalore, and SMPP.

These companies, looking to collectively raise around ₹66,000 crore via IPO route, have already received approval from the capital market regulator, SEBI, to launch their offerings. The firms are waiting domestic stock market to stabilise before they proceed with their listing plans.

The Indian equity market has seen sharp selling in the past few months, with benchmark indices, BSE Sensex and NSE Nifty, falling up to 14% from their peaks touched in September last year, wiping out over ₹90 lakh crore of investors’ wealth. The persistent volatility in the secondary market has impacted the IPO activities as investors have become more risk-averse and less inclined to invest in new companies amid worsening market dynamics.

IPOs face market heat

The primary market is showing signs of wariness as sharp correction in the domestic bourses, especially mid and small caps stocks, amid heightened valuation concerns have left IPO enthusiast jittery. The strong fund outflows by foreign institutional investors (FPIs), slowdown in economic growth, weak corporate earnings, and a global tariff uncertainty have also dampened craze for IPOs. Investors are less willing to invest in newly issued securities amid concerns about the overall market health and potential lack of liquidity for their future investments.

"An IPO is a critical, one-time event, making perfect timing essential. Companies aim for peak market conditions to maximise their value. However, the recent market correction, particularly affecting small and mid-sized businesses, is forcing many to reconsider their IPO plans or accept reduced valuations," says Pranav Haldea, Managing Director of PRIME Database Group, a leading provider of data on the capital market.

Bajaj Broking in a report said that despite receiving SEBI approvals, some companies have delayed or paused their IPO listings due to market volatility, weak investor sentiment, and unfavourable valuations. Factors such as global economic uncertainty, fluctuating interest rates, and sector-specific challenges have made firms cautious about their public debut. “Many are waiting for improved market conditions to ensure better pricing and investor participation,” it added.

How the IPO market fared in 2025

After blockbuster run in 2024, pace of activity in IPO market has slowed significantly in the calendar year 2025 amid weak market sentiments. In the first two months of CY25, 10 main board IPOs cumulatively raised around ₹16,000 crore, which was 37% lower than over ₹25,400 crore garnered by 15 companies in December 2024, which was the highest since February 2007, when 18 firms launched their public issue. Overall in CY24, 91 IPOs raised a total of ₹1.59 lakh crore, sharply higher than ₹49,437 crore garnered by 58 IPOs in 2023; ₹59,939 crore by 40 firms in 2022; and ₹1.2 crore by 63 entrants in 2021.

The slowdown in IPO activity has been further impacted by reduced subscription and stumbling performance of newly listed big-ticket IPOs such as Hexaware Technologies, Dr. Agarwal's Health Care, and Ajax Engineering. As per the latest exchange data, 5 out of 10 mainboard listed in CY25 are trading below their issue price, while nearly half of 2024 entrant have delivered negative return.

The S&P BSE IPO index, that tracks the performance of IPO-listed companies, has slumped 20% year-to-date (YTD) as compared to 6% fall in the BSE benchmark Sensex in the calendar year 2025. The sharp correction in the BSE IPO index, after continuously outperforming Indian Benchmark indices Sensex and Nifty by a wide margin in the recent past, clearly indicates weak market sentiment. In the CY24, the BSE IPO Index jumped 34.83%, surpassing the NIFTY50’s gain of 17.51% and Sensex of 16.84% driven by strong investor participation amid favourable market sentiment, resilient economic growth, high liquidity, and FOMO (fear of missing out).

Pipeline remains strong

The IPO pipeline remains staggering as 67 companies proposing to raise ₹1.17 lakh crore are awaiting SEBI approval. The list includes LG Electronics India, HDFC Bank’s subsidiaries HDB Financial Services and Credila Financial Services, WeWork India, Indira IVF Hospital, Dorf Ketal Chemicals, Aegis Vopak Terminals, and many others.

In addition, scores of renowned startups are preparing to file their offer documents in the near future such as boat, Zepto, PhysicsWallah, CarDekho, InCred, Shiprocket, Milky Mist Dairy.

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