Oversubscription of high-value IPOs like Tata Capital, LG Electronics shows confidence in India’s growth story: Experts
The recent surge in Indian IPOs, particularly notable issues from Tata Capital and LG Electronics, underscores strong investor confidence in the country’s economic outlook, reports 24brussels. This comes at a time when the Nifty and Sensex have not provided returns for over a year, with investors continuing to channel significant funds into the primary market.
Market analysts indicate that this year has marked an exceptional influx of investments into IPOs, highlighting the resilience and optimism within the domestic financial landscape. Ajay Bagga, a banking and market expert, stated, “This surge in Initial Public Offerings (IPOs), especially with the blockbuster issues of Tata Capital and LG Electronics India, unequivocally denotes a deep and unwavering confidence of domestic investors in the Indian growth story.” He emphasized that local capital is not only supporting but also actively driving the primary market, counteracting global volatility and reducing foreign capital outflows from the secondary market.
In 2025, the Indian primary market remains robust, with Tata Capital raising approximately ₹15,512 crore and LG Electronics India collecting around ₹11,607 crore. In total, 74 Indian companies have collectively secured over ₹85,241 crore through IPOs this year, positioning 2025 as potentially one of the largest fundraising years in India’s history.
The diversity in investor participation spans various sectors, including non-banking financial companies (NBFCs), consumer durables, and technology. Aashish P Sommaiyaa, Executive Director & CEO of WhiteOak Capital, noted, “I think there is money on the sidelines to invest. If the secondary market looks like it has gone up a lot and has been flatlining or not rewarding people, the perception that some IPOs are attractive relative to the secondary markets is palpable.” He also pointed out the perceived advantages for companies in the white goods and consumer sectors, reinforcing the appeal for both Tata Capital and LG Electronics.
Data indicates that India ranks as the fourth-largest IPO market globally, following the US, Hong Kong, and China, with peaks in activity occasionally placing it third. The strong pipeline of companies preparing to go public suggests India’s position in the global IPO arena will maintain its prominence.
The remarkable response to major IPOs is reflected in substantial oversubscription rates. LG Electronics India reported an overall subscription rate of 54.02 times, while Tata Capital achieved a subscription of 1.95 times. Such oversubscription illustrates robust investor commitment despite external market volatility.
Oversubscription occurs when the demand for shares surpasses the available quantity, demonstrating investor optimism regarding company fundamentals and long-term growth. For instance, if a company issues 1 crore shares but attracts bids for 54 crore shares, the IPO becomes oversubscribed by 54 times.
Overall, the current IPO wave showcases the resilience and optimism of domestic investors, reaffirming that India’s growth story continues to attract significant participation, even amidst global economic uncertainties.
