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‘161 IPOs garner $5.52 bn till November in 2018’

Indian stock exchanges ranked second globally in terms of number of initial public offerings (IPOs), raising $5.52 billion from 161 offerings till November this year, according to a report.

At the BSE and the National Stock Exchange, there were only two IPOs in fourth quarter of this calendar year, compared with nine and three in fourth quarter of 2017 and third quarter of 2018, respectively, said EY India IPO Trends: Q4 2018 report.

A similar trend was witnessed in the small and medium enterprise (SME) market. There were eight IPOs in fourth quarter of 2018, compared with 31 and 42 in fourth quarter of 2017 and third quarter of 2018, respectively, showing a drop of 74 per cent and 81 per cent, respectively, it said.

Industrial sector — construction and engineering — was the most active in terms of number of IPOs, whereas the financial services sector was at the top in terms of issue proceeds.

According to the report, the drop in IPOs could be attributed to reasons such as significant corrections in the stock markets in mid-cap and small-cap stocks.

Further, the amount of volatility has increased due to uncertainties around global growth compounded by the ongoing US-China trade wars, it said.

“Overall, we expect IPO candidates to take a ‘wait-and-watch’ approach, until the stock market correction, low rupee exchange rate and other domestic and geopolitical uncertainties reach resolution,” it said.

Meanwhile, with 261 IPOs raising $60 billion, the US remained in the spotlight as the leading source of IPOs in 2018, the report added.

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