INITIAL PUBLIC OFFERING AND ITS TREND IN INDIA

Abstract

The Initial Public Offering (IPO) allows companies to raise additional capital for expansion while also providing an escape route for some early-stage investors. Companies must first establish solid fundamentals and profitability potential in order to pique investors' interest in a successful IPO. In 2021, a number of enterprises went public, ranging from tech start-ups to chemical manufacturing firms and restaurant franchises. According to investment bankers who watch IPOs, this will be a record year for fundraising. Thus, the uptrend in Indian equities, which lasted from mid-2020 to late 2021, attracted a slew of companies, including Zomato, Nykaa, and Paytm, all of which sought to take advantage of the rising confidence and get the best price for their stock. Millions of retail investors flocked to Asia's best-performing stock market in search of a piece of the action, and several IPOs benefited from the craze. This research paper discusses the increasing trend of IPO in India, starting from 2021, why companies are going public just after the pandemic, and what it is for the investor to look into before entering into the IPO markets. The literature review is about four different paper that discusses four different aspects related to the IPO, such as underpricing/overpricing, the method used for arriving at the IPO price, investors' sentiments when investing in IPO, etc, and tries to establish familiarity with and understanding of current research in a much simpler way. Furthermore, the paper has examined 4 different IPO namely: Barbeque Nation, Nykaa, Paytm, and Adani Wilmar. The reason for selecting these companies is to study them and the reason why the company went in for their IPO, as well as to gain a sense of their financial situation and how they value their business, which can determine whether they succeed or fail in the market. In other words, the goal of this paper is to demonstrate the relevance of valuation and how it affects the successful selling of an IPO as well as its ability to rapidly expand.