Page 84 - Edelweiss India Conference 2022 FLIPBOOK

THE NEW EDGE

Funds raised via primary markets at decadal-high

1900

1600
( INR bn-12m moving sum) 1300

1000

700

400

1200
Dec- 11 Dec- 13 Dec- 15 Dec- 17 Dec- 19 Dec- 21

IPO money Raised (non-Financia cos.)

Source: CMIE, Edelweiss research

Equally importantly, the nature of companies accessing the market has widened
substantially. There is a shift away from traditional capex-heavy businesses, with a greater
services bias—needed, given the substantial services bias that India’s GDP fundamentally
The IPOs also opened carries. The IPOs also opened up to new-age companies—often loss-making, valued for
up to new-age fairly long-term growth, and decisively benchmarked to global peers.
companies—often
loss-making, valued This does not necessarily mean investors will make strong returns though—the IPO boom
of now carries the same return and other risks as previous cycles, but it widens the market
for fairly long-term to a variety of businesses that can access capital.
growth, and decisively
benchmarked to We believe this has also opened up the door to listings, for instance, to consumer tech
global peers
of growth in the underlying economy and the shift in business models; and provide
benchmarking, if not access, to these players.

This trend should also progressively raise the level of technology company participation
in indices – so far missing (dominated by more conventional IT services companies), in
stark contrast to their material representation in the US and China indices. India’s playing a
catch-up—but necessary, and about time.

82 Edelweiss Securities Limited