Biggest SME IPOs by Issue Size

The Small and Medium Enterprises (SME) Initial Public Offering (IPO) market has emerged as a vibrant segment of the Indian capital markets, particularly in 2024. With a remarkable shift towards larger offerings, this market is capturing the attention of investors and analysts alike. This article delves into the biggest SME IPOs by issue size, discusses key trends in the SME IPO market in 2024, and highlights significant offerings that have set new benchmarks.

Biggest SME IPOs by Issue Size: Evolution of the SME IPO Market

Since its inception in 2012, the SME IPO platform has provided smaller companies with access to public capital, enabling them to grow and expand. The landscape has changed dramatically over the years, but 2024 stands out as a pivotal year. As of September 2024, 202 SMEs have collectively raised around INR 7,211 crores, marking a 53% increase from the previous year. This surge indicates not just a recovery from past market fluctuations but also a newfound investor confidence in this segment.

The increasing size of SME IPOs in India is noteworthy. Traditionally, these offerings were modest, often raising amounts between INR 4 crores and INR 50 crores. However, recent trends show that 116 IPOs launched in the first half of 2024 with an average issue size of INR 31.65 crores.

Biggest SME IPOs by Issue Size: Key Trends in the SME IPO Market in 2024

1. Record Fundraising: The first half of 2024 saw fundraising through SME IPOs reach approximately INR 3,671 crores, which is almost two-thirds of the total raised in all of 2023 (INR 4,686 crores). This marks the highest amount raised in the first six months since the introduction of the SME platform.

2. Oversubscription: The enthusiasm surrounding SME IPOs has led to unprecedented oversubscription rates. For instance, HOAC Foods India was subscribed nearly 1,994 times when it launched its offering in May 2024. Similarly, Magenta Lifecare saw subscriptions close to 983 times during its offering. Such figures indicate not only strong retail interest but also highlight potential risks associated with speculative trading.

3. Regulatory Scrutiny: The rapid growth of this segment has caught the attention of regulatory bodies like the Securities and Exchange Board of India (SEBI). Concerns about market manipulation and excessive speculation have prompted discussions about tightening regulations and introducing caps on oversubscription. This regulatory focus aims to ensure that investor interests are protected while maintaining market integrity.

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Biggest SME IPOs by Issue Size

As we examine the Biggest SME IPOs by issue size, several notable offerings have emerged in 2024:

Sahasra Electronics Solutions Limited: This electronics manufacturing services provider launched an IPO with an impressive offer size of INR 186.16 crores from September 26 to September 30. The stock debuted on October 4 with a listing premium of approximately 99% against its issue price of INR 283 per share.

SAR Televentures: With an issue size of INR 149.99 crores, this company opened its public offering from 1- 3 November 2023, and made its market debut on 8 November 2023. The stock has shown promising returns since listing.

Mach Conferences: This company raised INR 125.28 crores through its public offering from 4 – 6 September 2024, listing on 11 September with a listing day return of over 30.67% against its issue price.

These examples illustrate a clear trend towards larger offerings within the SME sector. The increasing issue sizes not only reflect growing investor confidence but also suggest that SMEs are becoming more competitive in attracting capital.

Largest SME IPOs by Issue Size: Market Sentiment and Investor Behavior

The current sentiment surrounding the SME IPO market in 2024 is overwhelmingly positive. Retail investors are actively participating in these offerings, driven by strong post-listing performances and favourable market conditions. The BSE SME index has risen significantly, showcasing a robust performance that reflects heightened investor confidence.

However, while optimism prevails, it is essential for investors to approach these opportunities with caution. The rapid rise in oversubscription can lead to inflated valuations that may not accurately reflect a company’s fundamentals. As noted by market analysts, understanding a company’s business model and growth prospects is crucial for long-term investment success.

Moreover, retail investors are increasingly participating directly in these offerings. The rise in dematerialized accounts across India indicates that more individuals are looking to invest directly in SMEs rather than relying solely on institutional investors. This shift signifies a democratization of investment opportunities but also raises concerns about potential overexuberance among inexperienced investors.

Also Read: All-Time Largest IPOs in India at a Glance

Largest SME IPOs by Issue Size: Conclusion

In conclusion, our article and comprehensive database on SME IPOs serve as invaluable resources for investors seeking to navigate the dynamic landscape of the SME market. By providing detailed insights into the biggest SME IPOs by issue size and trends within the SME IPO market in 2024, we empower investors to make informed decisions based on reliable data and analysis. Our database offers up-to-date information on issue sizes, subscription rates, and post-listing performances, enabling investors to identify promising opportunities while mitigating risks.

Furthermore, with the increasing interest in larger offerings, our platform helps demystify the complexities of investing in SMEs, fostering greater confidence among retail investors. By leveraging our resources, investors can enhance their understanding of this burgeoning sector and strategically position themselves for potential growth in their investment portfolios.