SME IPOs garner ~8.25 bn in June quarter

Small and medium enterprises (SMEs) raised ~8.25 billion through initial public offerings (IPOs) in the first quarter of 2018-19, more than two-fold jump from the preceding financial year.

Funds raised through IPOs were meant for business expansion plans, working capital requirements and other general corporate purposes, according to offer documents.

A total of 47 companies got listed with initial shares-sale offers worth ~8.25 billion during April-June quarter of 2018-19 as compared to 24 firms which tapped the IPO route to garner ~31.0 billion in the same period of the previous year, according to the data provided by merchant banker.

This reflects a significant rise in the amount raised through SME platforms of BSE and NSE.

Further, average issue size also increased to over ~170 million during the period under review from ~130 million in the first quarter of 2017-18.

“It has been more than six years since SME market opened up and we have witnessed this market evolving gradually with varying trends: high over-subscriptions, widening shareholder base, venture capital exits through this platform, anchor investor participation and the like.

“This segment will continue to be of interest and will grow leaps and bounds in time to come,” said Mahavir Lunawat, group managing director, at Pantomath Advisory Services Group.

Geographically, Gujarat topped the list as a maximum 17 firms from the state listed on SME bourses.