11 companies seek SEBI approval for IPOs worth Rs 7200 crores in August

Last Updated: Tue, Sep 04, 2018 11:04 hrs
The Securities and Exchange Board of India

New Delhi: Call it expansion or need for fresh capital, but as many as 11 firms have sought market watchdog SEBI's (Securities and Exchange Board of India) approval for an (IPO) Initial Public Offering totalling Rs 7200 crores in August alone.

This number, according to merchant banking sources.quoted in a PTI report.

Some of these companies include AGS Transact Technologies and ASK Investment Managers.

The others to have filed preliminary papers with market watchdog include Studds Accessories, Senco Gold, Harsha Engineers, Mrs Bectors Food Specialities, Sansera Engineering, Nihilent Technologies, Dodla and Shyam Metalics and Energy, and Xelpmoc Design and Tech.

Equity shares of these firms are proposed to be listed on BSE and NSE.

Most of the funds raised through the IPOs will be used for expansion plans, repayment of loans availed by these firms and to support working capital requirement, according to the draft papers filed by the respective companies with Securities and Exchange Board of India (SEBI).

Besides, some of the firms believe the listing of equity shares on bourses will enhance their brand name and provide liquidity to existing shareholders.

Further, some of the firms are taking the IPO route to provide exit to their existing shareholders like private equity and venture capital firms.

The IPO market has seen heavy activity so far this year as 21 companies have mopped-up close to Rs 28,000 crore through initial share-sale.

"The IPO market is buoyant for good quality company issues which are priced cautiously. There is investor appetite for companies which price their IPOs keeping money-on-table for investors," J Kalyaniwala, VP for investment banking at Prabhudas Lilladher was quoted as saying in the report.

Experts said that proactive regulatory environment coupled with uplifted investor sentiment has helped the IPO market.

Further, SEBI in its board meeting in June, had decided to reduce the timeline for announcement of initial share-sale price band, which is further going to aid the IPO market. Under the new rules, the timeline for announcing price band for initial share-sale offer will be reduced to two days from the current five days.

2017 saw 36 companies collectively raising a record of over Rs 67,000 crore through their respective initial share-sales. The previous high being in 2010 when Rs 37,535 crore was garnered, almost half the amount.