Large, marquee IPOs do not guarantee an instant jackpot for investors

Large-sized initial public offers (IPOs) of well-known companies do not always deliver quick gains to investors, as many marquee listings have not generated immediate returns, data shows.

For an IPO to be successful in terms of subscription and listing gains, analysts suggest, the issue has to be attractively priced for investors to participate and make money.

IPOs of One 97 Communications (parent company of Paytm; issue size: Rs 18,300 crore), Life Insurance Corporation of India (LIC; issue size: Rs 20557.23 crore) and Hyundai Motor India (issue size: Rs 27858.75 crore) are some of the marquee companies that hit the primary markets with a large issue size.

However, the listing price, and even the current market price in some cases like Paytm, tells a different story.

Among these, LG Electronics (issue size: Rs 11,604.73 crore) is trading nearly 41 per cent higher that its issue price of Rs 1,140. Similarly, the stock of Tata Capital (issue size: Rs 15511.87 crore) is trading nearly 6 per cent higher than its issue price of Rs 326 per share, data shows.

“For investors, it has to be a proposition where they can generate returns. If that happens, large IPOs - like the proposed offerings of National Stock Exchange (NSE) and Reliance Jio Infocomm (Reliance Jio) - can get 3-4x oversubscribed. The pricing has to leave something on the table for investors. If they don't, IPOs have found it difficult to sail through. Paytm is a good example of over pricing. We saw how the stock did post listing,” Baliga said.

Meanwhile, India’s largest telecom operator Jio Platforms Ltd (JPL), the Reliance Industries-controlled company, filed its draft red herring prospectus (DRHP) last week. The company plans to raise about Rs 37,700 crore through the listing, reports suggest.

Earlier in June, National Stock Exchange (NSE), too, filed its DRHP with Sebi for an estimated Rs 30,000-crore IPO. The offer will be entirely an offer for sale (OFS), meaning existing shareholders will sell a portion of their holdings.

Retail investors, said G Chokkalingam, founder and head of research at Equinomics Research, must look at the company's valuation relative to listed peers, and the outlook for the company and sector before investing in an IPO.

“IPO pricing needs to leave something on the table for investors to take home. If the issues are priced to perfection or overpriced, investors may not find them attractive,” he said.

Primary market revival

Issues like NSE and Reliance Jio, Baliga said, can revive the primary market despite geopolitical issues. The US - Iran peace deal, he believes, will get signed sooner or later, which augurs well for the secondary markets.

“This, in turn, will boost the primary markets as well. The key monitorable from now on is how the monsoons play out. In case of a positive surprise, the markets will rally,” he added.

Meanwhile, 112 Indian corporates raised Rs 1,78,963 crore through main board IPOs in 2025-26 (FY26), suggests data from PRIME Database, 10 per cent higher than Rs 1,62,387 crore mobilised by 78 IPOs in the preceding year.

Chokkalingam, too, expects a good response to both the NSE and RJio IPOs, which he feels can revive the primary market sentiment to some extent, provided the secondary markets stay supportive. "Both these companies operate in consumer-facing sectors (stock exchange and telecom) and are likely to do well. That said, a lot would depend on how the IPOs are priced," Chokkalingam added.