2 IPOs hit target; experts cautious to call it revival

The sentiments have definitely improved, though it didn’t result in the launch of many IPOs, says IDFC MD

Despite the two initial public offers ( IPO) launched during this financial year receiving an overwhelming response from investors, merchant bankers said that it is too early to view it as a signs of revival in the primary market.

According to them, the regulatory filings of the draft offer documents are yet to pick up pace and it would take a couple of months for companies to tap the primary market in a big way.

“The sentiments have definitely improved, though it didn’t result in the launch of many ini- tial public offers. However, in the last three months, we have seen an increase in the activity levels and since document preparation would take at least 2- 3 months we can see a couple of companies filing their offer documents with the regulator,” said Indraneil Borkakoty, managing director, IDFC Investment Banking on the sidelines of the announcement of ` 350 crore public offer from Sharda Cropchem Ltd.

In April this year, the ` 180 crore public offer from Wonderla Holidays was subscribed 38 times while the ` 197 crore initial public offer from Snow- man Logistics, which was launched last week got subscribed 60 times.

While investor response to these offers remained impressive indicating enough appetite for fresh quality papers, not many companies have come forward to file their draft offer documents with the Securities and Exchange Board of India ( SEBI).