Rs 90,000 crore in 90 days: One of India’s biggest IPO cycles in history produces poor listing gains

Introduction

Over the last 90 days, the Indian primary market has witnessed an extraordinary surge in activity: 61 companies raised more than ₹ 90,000 crore via Initial Public Offerings (IPOs), marking one of the largest fundraising cycles in the country’s history. While the scale of capital mobilization is impressive, a deeper look at post-listing performance reveals a more nuanced and cautionary picture: despite the boom, many IPOs have delivered muted listing gains, underscoring a shift in investor sentiment.

The IPO Boom: Scale and Composition

This recent fundraising burst was broad-based and diversified. The IPOs came from a variety of sectors: “new-age platforms, financial services, engineering, renewables, chemicals, consumer brands” all found their way to the public markets.

Some marquee names contributed heavily to this haul: Tata Capital, LG Electronics India, Lenskart, Groww, and Tenneco Clean Air were among the prominent issuers. This suggests that both legacy businesses and growth-oriented companies are leveraging the capital markets aggressively.

Meanwhile, the broader pipeline looks robust going forward. Analysts are pointing to potentially huge IPOs in the near future — including giants like Jio, SBI Mutual Fund, NSE, PhonePe, OYO, and Flipkart — which could easily push fundraising into new territory.

Disappointing Listing Performance

Despite the frenzy on the issuance side, investor returns have been mixed — and in many cases underwhelming.

• According to Trendlyne data, 44 of the 61 IPOs (over 70%) saw listing gains of less than 10%.
• Even more striking: 19 IPOs gave flat or negative returns, meaning a sizeable chunk of these companies actually listed at or below their issue price.
• On average, the return from IPO price to current market price for these issues is only about 11%, far lower than boom years like 2021–2022.
• Moreover, around 42% of the 61 companies are trading below their issue price.

This is a marked departure from prior cycles when IPOs often saw euphoric debut-day pops.

Who’s Getting It Right — and Who Isn’t

A closer look suggests that not all IPOs are created equal: performance is correlating strongly with business quality, fundamentals, and investor backing.

1. Retail Favorites Are Struggling
   Surprisingly, the IPOs that drew the strongest retail interest are among the worst performers. For example:
   • Dev Accelerator was subscribed 164.72× by retail investors, but now trades nearly 30% below its issue price.
   • VMS TMT, another highly subscribed small-cap, is down 37%, despite retail bids crossing 47×.
   • Regaal Resources (159×) and Highway Infrastructure (155×) also trade below issue price.
   This suggests that retail euphoria alone is no guarantee of strong listing performance.
2. Quality Matters
   On the flip side, companies with sound financials, good cash flows, or strong market positioning have fared much better:
   • Aditya Infotech soared — up about 149% from its IPO price.
   • Anand Rathi Share Stock gained over 80%.
   • Other names: PhysicsWallah (+34%), Groww (+56%), Epack Prefab (+58%) — all suggest that investors are rewarding fundamental strength.
   • Among newer business-tech names: Lenskart is up modestly (~3%), Pine Labs has gained around 8%.
3. Valuation Sensitivity is Back
   Analysts interpret this pattern as a sign that valuation discipline is returning. The market is no longer indiscriminately rewarding every high-growth IPO; instead, it’s favoring companies with clearer earnings visibility or cash flow potential.

Macro and Market Sentiment

Several broader themes help explain why this IPO cycle is under-delivering on listing day, despite massive fundraising:

• Volatility & Risk Aversion: The secondary markets appear more volatile and cautious than in prior boom years, pressuring IPOs that don’t have rock-solid fundamentals.
• Investor Fatigue: With IPO activity at such a high pace, some investors may be reaching saturation, or becoming more selective.
• Pricing Pressure: There is a sense that some IPOs may have been priced too aggressively. The muted debut gains suggest limited room for an upward re-rating on listing day.
• Exit vs Growth Capital: In some cases, IPOs may serve more as an exit route for early investors rather than a capital-raising vehicle for business growth — a dynamic that may not endear new shareholders hoping for listing pops.

Implications & Risks

This paradox — record fundraising but weak listing performance — carries several important implications:

1. For Retail Investors:
   • The “chase-every-IPO” strategy is riskier now. Underperformance, especially in aggressively bid retail IPOs, suggests that labeling an IPO a “sure bet” based on grey-market or subscription buzz may be misleading.
   • Investors need to evaluate IPOs on fundamentals (business model, profitability, cash flow), not just hype and subscription metrics.
2. For Issuers / Companies:
   • High demand does not guarantee long-term investor support. Firms with weaker fundamentals may face more volatile post-listing trading.
   • Given that institutional and quality-backed IPOs are faring better, companies aiming for a successful listing might need to focus on more disciplined valuation and strong financial narratives.
3. For Market Intermediaries:
   • Investment bankers, underwriters, and advisors will need to be more careful about pricing IPOs. Over-pricing may dampen listing gains, but underpricing may leave money on the table for issuers.
   • Regulators and market platforms should be alert to speculative excesses, particularly on the retail side, to avoid bubble-like behavior.

Looking Ahead: The IPO Pipeline

Despite tempered listing gains, the IPO pipeline remains very strong:

• Analysts expect a big 2026, with marquee names like Jio, NSE, SBI Mutual Fund, OYO, PhonePe, Flipkart lined up.
• These companies represent different themes: consumer technology, payments/digital infrastructure, financial-market infrastructure, and more — potentially drawing both institutional and retail interest.

However, the way these IPOs perform will likely hinge on whether the market sees genuine value, not just growth prospects. The current cycle may serve as a turning point: capital can still be raised, but listing gains may no longer be a given.

Conclusion

The ₹ 90,000 crore IPO bonanza over 90 days is historic in scale. Yet, the muted listing performance — with nearly half the issuers trading below issue price, and many delivering less than 10% gains — signals a sober message: investors are growing more discerning.

Gone may be the days when IPOs automatically popped on debut; in this cycle, fundamentals, valuation, and financial strength matter more than hype. For retail investors, this is a wake-up call to move beyond subscription fervor. For companies, it’s a reminder that raising capital is only half the battle; sustaining investor confidence post-listing is equally critical.

Moving forward, if the IPO pipeline continues to swell, the success of future issues will likely depend on how well they marry exciting business stories with credible financials — not just how much capital they raise.