With Indian stock markets going through a buoyant phase, various privately held companies, including many new-age startups, plan to go public and tap into the bullish market to fund their expansion plans.
The latest to do so is PB Fintech Ltd, which operates online insurance platform Policybazaar and credit comparison portal Paisabazaar. It has received the Securities and Exchange Board of India’s approval to raise 60 billion rupees (US$799 million) through an initial share sale.
According to the draft red herring prospectus submitted to the capital market regulator, the initial public offering comprises a fresh issue of 37.5 billion rupees worth of equity shares and an offer for sale of 22.67 billion rupees by existing shareholders. This includes Yashish Dahiya, Chief Executive Officer and Co-Founder PolicyBazaar, and others.
Earlier on Monday, six companies, including online beauty products seller Nykaa, edible oil manufacturer Adani Wilmar and health insurance firm Star Health & Allied Insurance, received capital market regulator’s approval for initial share sales. The other three include Penna Cement Industries, Latent View Analytics and Sigachi Industries.
Nykaa wants to issue fresh equity shares worth 5.25 billion rupees and an offer for the sale of more than 43 million equity shares by promoters and existing shareholders. Merchant bankers claim the initial share sale is expected to fetch 35-40 billion rupees, valuing the company in the range of $5-5.5 billion.
Adani Wilmar is a 50:50 joint venture company between the Adani group, owned by India’s second richest man Gautam Adani, and the Singapore-based Wilmar group. Its proposed offering will be in the form of a fresh issue of equity shares for an amount of up to 45 billion rupees (approximately $600 million). There will not be any secondary offering.
The company, which sells cooking oils under the Fortune brand, is a major player in the edible oil industry.
Star Health is a leading private health insurer and is owned by a consortium of investors like leading stock market broker Rakesh Jhunjhunwala and Westbridge Capital. It plans to offer fresh equity shares worth 20 billion rupees and an offer for the sale of more than 60 million equity shares by promoters and existing shareholders.
Earlier this month, hotel aggregator Oyo Hotels & Homes filed for an initial public offering to raise $1.2 billion. It will include 83% of the fresh issue of shares and the remaining will be offered for sale. Japan’s SoftBank owns a 46% stake in Oyo and it also has the backing of Greenoaks Capital and Lightspeed Venture Partners.
Recently US tech giant Microsoft Corporation invested nearly $5 million and also entered into a pact to develop new travel technologies enabled by its Azure cloud infrastructure and artificial intelligence for Oyo.
In July, food delivery startup Zomato netted $1.3 billion through its initial public offering. According to stock exchange data, the offer was oversubscribed 38 times, driven by strong institutional investor interest. It received bids for 27.5 billion shares against 719 million shares on offer.
Digital payments giant Paytm has also filed for initial share-sale and ride-hailing firm Ola, also backed by SoftBank, is also set to enter markets.
Though India has braved two waves of the Covid-19 pandemic and the economy has taken a hit, the stock markets remain bullish with benchmark indexes scaling new peaks. With bank interest rates at their lowest, many Indians have begun investing in stocks. Strong foreign institutional inflows have also contributed to the performance of Indian benchmarks.