20 Upcoming IPOs you must focus on.


10 min read
20 Upcoming IPOs you must focus on.

There’s a wave of IPOs coming in 2020. Many of the companies have already got SEBI nod for launching their IPOs long before but they were waiting for the right moment to make the debut in the market. Here are some of the IPOs that may deliver handsome returns with the least risk.

Here’s the list of 20 big IPOs that could be listed in 2020:

1. SBI Card

Incorporated in 1998, SBI Cards and Payment Services Limited is a subsidiary of SBI, India’s largest commercial bank in terms of deposits, advances and the number of branches. SBI currently holds 74.00 % of the pre-Offer issued, subscribed and paid-up Equity Share capital of the Company.

The company the 2nd largest credit card issuer in the country, with a 17.6% and 18.0% market share of the Indian credit card market (number of credit cards) as of March 31, 2019, and September 30, 2019, respectively, and a 17.1% and 17.9% market share of the Indian credit card market ( total credit card spends) in fiscal 2019 and in the six months ended September 30, 2019.

Remember: In India, every 3 out of 10 people holds credit card so India’s credit card market is highly unpenetrated.

2. Equitas Small Finance Bank:

Equitas Small Finance Bank has submitted its papers with the SEBI. The Chennai-based small finance bank will be the third small finance bank to file for an IPO after the CSB Bank and Ujjivan Small Finance Bank. The Equitas Small Finance Bank is looking to raise Rs 550 crore through its IPO. The total IPO size is expected at around Rs 1,000 crore. The initial public offering will be a combination of fresh issue and offer for sale, according to the red herring prospectus filed by the bank

As of 30 September, its distribution channels comprised 853 Banking Outlets and 322 ATMs across 15 states and union territories in India. As of six months ended 30 September, the bank’s total loan disbursements stood at ₹4,426 crore and retail deposits stood at ₹2,608 crores.The bank’s net profit during the period was ₹107 crore, while its net interest income stood at about ₹688 crores. The bank’s debt to equity ratio stood at 6.06%.

3. HDB Financial Services

HDFC is the largest private sector lender bank which is known for its stellar performance on the streets for years. The bank’s subsidiary that is HDB Financial Services in which bank holds 95.5% stake is swiftly gaining an edge. The HDB was set up as a non-banking finance company by HDFC bank in June 2007 and commenced operations in the year 2018.HDB, founded in 2007, offers various products such as personal loans, commercial vehicle loans, gold loans, and loans against property.

Valued at over Rs 80,000 crore in the grey market, HDB is making it the country’s fourth most valuable non-bank lender at the existing prices.

As per ET, Brokers and market experts say HDB Financial Services is being traded heavily in the grey market at Rs 1,000–1,050 per share in hopes of an early initial public offering.

4. Bajaj Energy

Bajaj Energy had received capital markets regulator Sebi’s go-ahead to raise an estimated Rs 5,450 crore through an initial share-sale offer. According to draft papers, Bajaj Energy’s initial public offer (IPO) comprises fresh issuance of shares aggregating up to Rs 5,150 crore and an offer for sale of scrips up to Rs 300 crore by Bajaj Power Ventures. The company plans to utilise the proceeds from the IPO to purchase 6,99,36,900 equity shares of Lalitpur Power Generation Company from Bajaj Power Ventures and Bajaj Hindustan Sugar for Rs 4,972 crore, and the remaining amount will be utilized for general expenses.

Bajaj Power owns 100% stake in Bajaj Energy.

Note: The company, which filed its IPO papers with Sebi in April, obtained the regulator’s “observations” on August 30, the latest update available with the capital markets watchdog showed. Sebi’s observation is necessary for any company planning to launch public issues. Let’s see when it is available for us to subscribe.

5. PNB MetLife India:

The stock market is buzzing with Punjab National Bank (PNB) is most likely to launch an IPO of PNB MetLife India after the bank completes the proposed merger with United Bank of India and Oriental Bank of Commerce. Management had hinted about the launch of PNB MetLife India IPO in 2020 citing decisions will be taken by the shareholders. I

  • PNB holds a 30% stake.
  • Metlife holds 26% stake
  • Elpro holds a 21% stake.
  • J&K Bank holds a 5% stake.
  • M. Pallonji group of companies holds 18% stake.
PNB Metlife waiting for right conditions for an IPO: Ashish K Srivastava, MD and CEO, PNB MetLife India.

6. UTI AMC:

The UTI AMC has submitted its papers with the SEBI for its IPO. As per ET, Media reports peg the IPO size at around Rs 3,800–4,800 crore, which would value the asset manager at around Rs 12,000–15,000 crore. According to the media reports, in UTI AMC IPO, SBI along with BoB, LIC, and PNB will offload 18.5% shares in the Asset Management Company. The rest of the UTI AMC shares are with the US company T Row Price and it would also offload its shares during the launch of the UTI AMC IPO.

7. HDFC ERGO

Yes, you are right. HDFC is coming up with two IPOs in 2020. HDFC Ergo provides general insurance policies, while HDFC Credilia offers education loans. These two subsidiaries of the parent company will be a good competition for the life insurance players and share market investors or IPO investors can expect good returns in the IPO.

8. Kotak Mahindra AMC

Kotak Mahindra Bank is planning to introduce its AMC business to the stock market. There are reports that it’s expected to hit the market next year. Starting its operations in 1998, the company today has its presence in 82 cities and has 86 branches. Kotak AMC’s asset under management is Rs 1.7 lakh crore and of which Rs 50,000 crore is in equity.

9. Aditya Birla AMC

Aditya Birla AMC stands as the sixth company in-line to enter the secondary market. Established in 1994, the company’s total domestic assets under management (AUM) is close to Rs. 2,540 billion for the quarter ended June 30th, 2019. It has over 7 million investor folios as of June 30th, 2019. IPO date and size has not yet disclosed officially.

10. Reliance Jio and Reliance Retail

Reliance Industries is planning to launch its two strongest weapons in the market next year i.e. Reliance Jio and Reliance Retail. RIL is said to have made clear in the discussions that an IPO will take place only after the company sees its recently demerged fibre and tower businesses — Jio Digital Fibre Pvt Ltd and Reliance Jio Infratel Pvt Ltd respectively — get monetised via investors in the two InvITs.

“We have received strong interest from strategic and financial investors in our consumer businesses, Jio and Reliance Retail. We will induct leading global partners in these businesses in the next few quarters, and move towards listing of both these companies within the next five years,” Mukesh Ambani

11. Axis Bank AMC

Axis Bank will most likely to launch its AMC arm next year. There are still no reports on the listing but Axis AMC will be the third asset manager if it enters the secondary market early next year. As of September 2019, the company manages Rs 1,05,526.17 crore worth of assets. Currently, the AMC has been tied up with HDFC Life Insurance Company to offer insurance covers.

12. L&T AMC

L&T is the third company to launch its AMC business in the market. There are no details on the listing yet. They are expected to launch their IPO soon, the company manages Rs 69,213.42 crore worth of assets.

13. Exide Life Insurance Company.

Currently, there are three listed life insurance companies in the market, and it seems Exide Life Insurance Company could be the next one in line. The company began its operations in 2002 and today, manages assets worth Rs 14,300 crore. There are no reports on the listing of this company yet but they are expected to launch their IPO soon.

14. Jeevansathi.com

Along with Matrimony.com, Info Edge also is the owner of Jeevansathi.com. The pure-play internet company might launch Jeevansathi in the market next year. In the second-quarter earnings, Info Edge’s EBITDA declined due to higher losses in Jeevansathi, said Jefferies. This could be one of the reasons to raise funds for the company.

15. Tata Technologies

The Tata Group has revived plans to list Tata Technologies, an engineering solutions and IT product developing arm of Tata Motors, on the local bourses. The company is planning to raise Rs 1,400 crore through an initial public offering (IPO). Tata Motors holds a 70.43% stake in Tata Technologies, while Alpha TC, a wholly-owned subsidiary of the partnership sponsored by Mizuho Securities and other international investors, owns 8.71% in the company.

Tata Technologies was planning an IPO in 2008 to fund expansion and repay some of its debts, but the plan was dropped due to the global market meltdown.

16. Burger King

Quick service restaurant chain Burger King India has also filed draft papers for its initial public offering (IPO). The company is looking to offload up to Rs 400 crore of new shares in the IPO. Edelweiss Financial Services, Kotak Mahindra Capital, JM Financial, and CLSA are the investment bankers managing the IPO. Shares of the company are proposed to be listed on BSE and NSE. The issue comprises a fresh issue of shares aggregating Rs 400 crore and an offer for sale of up to 6 crore equity shares by QSR Asia PTE.With an average ticket value of Rs 500–550, the company had 202 outlets in 47 cities as of June 30. The company is planning to increase its outlets to 325 by the end of the year.

17. Montecarlo

Construction company Montecarlo Ltd has filed fresh IPO papers with capital markets regulator Sebi to raise an estimated Rs 550 crore. The initial public offer (IPO) comprises fresh issuance of shares worth Rs 450 crore, besides an offer for sale of up to 30 lakh equity stocks by existing shareholder Kanubhai M Patel Trust, as per the draft papers. The company may consider a pre-IPO placement for an aggregate amount not exceeding Rs 100 crore.

18. EaseMyTrip

Online travel company EaseMyTrip has filed draft papers with capital markets regulator Sebi to float a Rs 510 crore initial public offering. Through the IPO, the company’s founders Nishant Pitti and Rikant Pitti will each sell shares to the tune of Rs 255 crore through the offer-for-sale mechanism, according to draft papers filed with the Securities and Exchange Board of India (Sebi). EaseMyTrip.com is operated by Easy Trip Planners Private Ltd. The city-based company said the object of the public issue is to achieve the benefits of listing the equity shares on stock exchanges.

19 . Mazagon dock limited

Mazagon Dock Shipbuilders has received markets regulator Sebi’s go-ahead to float an initial public offering (IPO). The public sector undertaking had filed draft papers with the Securities and Exchange Board of India (Sebi) in August seeking its clearance to launch an IPO and obtained its “observations” on December 13, Sebi’s observations are necessary for any company to launch public issues like IPO, follow-on public offer (FPO) and rights issue.

Going by the draft papers, Mazagon Dock, a leading shipyard of India serving the nation’s strategic requirements, will see the sale of over 2.8 crore equity shares by the government. The issue is being managed by Yes Securities, IDFC Securities, Axis Capital, JM Financial and Edelweiss Financial Services.

20. NSE Ltd.

NSE aims to raise about Rs 10,000 crore from the IPO which would result in existing promoters selling 22–24% of their stakes. LIC of India, SBI Group, IDBI, Norwest Venture Partners and GS Strategic Investments Ltd (Mauritius) are among the shareholders that may sell a portion of their stake through the public offering. The market regulator had alleged that the exchange officials in collusion with a few traders and brokers. The NSE has reached out to the finance ministry and Securities and Exchange Board of India (Sebi) seeking their opinion about its plan to restart the IPO process and complete it sometime next year.

Performance of the last 10 IPOs listed in India.

8 out of 10 IPOs opened with premium, IRCTC tops the list with the listing gains of 127%.

How to maximize the chance of getting share allotment?

Suppose you applied for one lot and in the case of an IPO getting oversubscribed, the chances of an investor getting share allotment decease for an individual investor and only ‘lucky’ one gets the lot.

Solution: Try applying IPO from different Demat accounts from your family members. Chances of getting the lot to rise if multiple bids are made by different members of the same family. With lucky investors getting a minimum of one bid lot so if a family of five has applied for the same IPO at a cut-off price in smaller bid lots, chances for them getting shares in the draw are better than that for one application.

If you want to open Demat account in less than 4 hours then you can opt for Upstox (Know more). Ratan Tata backed Upstox is brokerage free, easy to use and more than 50 technical analysis tools.

Thanks!

Akshay Seth
Linkedin | Twitter
akshay.equity@gmail.com

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