What are the Top Upcoming IPOs in India ?

When a popular buzz-worthy company decides to "go public," there's much excitement amid the general public. The idea of investing in big corporations with hopes of earning huge sums reverberates with a mass population.

Up until now, Initial public offerings (IPOs) have been the wealthy and institutional investors' domain. However, in recent times, the internet has facilitated a level playing field for all types of investors. In an unprecedented fashion, IPOs have also been made available to ordinary investors who may only have small sums of money to invest.

While the returns from an IPO can be attractive in the long term, their reputation is also tainted with the flamed out businesses once they start trading as public companies.

The risk associated with this investment can be huge, but so is the potential payoff, which is why being informed is a boon. Hence, the beginners should engage in substantial amounts of due diligence before jumping into the IPO market.

When a privately held company is preparing to sell shares to the public, Investment Banks are required to sell shares on behalf of the IPO. Doing so can be very profitable for the banks, which is why competition can be fierce. Investors should look beyond the hype, and research well about the Company, which is offering the stock.

This year was full of many economic ups and downs; however, contradictory to what was expected, this year also saw a strain of many IPOs, most of which saw a successful launch. So, after a successful chain of IPOs in 2020, following are the top twelve upcoming IPOs in 2021:

1. Kalyan Jewelers India 

Kalyan Jewelers is engaged in designing, manufacturing, and selling a wide range of gold and other jewellery products. After the first quarter this year, Kalyan Jewelers had a total income of 10,181 Crores, up from 9814 Crores at the end of 2019. Total Borrowings after the last fiscal year were at 3,640 Crore.

Kalyan Jewelers India has recently received a nod from the Securities and Exchange Board of India (SEBI) to issue its initial public offering (IPO). According to the Draft offer document, the estimated Rs 1750 Crore IPO of Kalyan Jewelers would consist of a new equity issue of Rs 1,000 Crore and an offer for sale (OFS) worth Rs 750 Crore. 

2. Zomato

Zomato offers a search app that provides detailed information for restaurants. It enables consumers to identify, rate, and review restaurants and create their channels of foodies for trusted recommendations. Zomato unites over 55 million users to restaurants in 24 countries across the world. 

The Company is preparing for a public listing in the first half of 2021. It is estimated to raise a little more than $146.5 million as part of its ongoing Series J round of funding. 

Zomato is looking to issue 34,873 class J7 compulsorily convertible preference shares (CCPS) to the investors at an expected price Of Rs. 3,00,235 per share, garnering close to Rs 1,047 Crore ($141 million), the filings showed.

3. Barbeque Nation

Barbeque Nation Hospitality owns and operates Barbeque Nation Restaurants, currently serving at 138 outlets across India and seven outlets in the UAE, Oman, and Malaysia.  

Casual Dining chain Barbeque Nation Hospitality has acquired market regulator SEBI's approval to raise about Rs 1,000-1,200 crore through an initial public offering. The IPO comprises a fresh issue of shares worth Rs 275 Crore and an offer for sale (OFS) of up to 98,22,947 equity shares, according to the draft papers filed with the Securities and Exchange Board of India.

According to the market sources, the estimated IPO's size should be approximately between 1,000 crore – 1,200 crore Rupees. The Company will use returns to repay Rs 205 crore's outstanding debt in part or whole and general corporate operations. 

IIFL Securities, Axis Capital, Ambit Capital, and SBI Capital Markets are leading the issue. 

4. Home First Finance (HFFC)  

Home First Finance Company (HFFC) Limited is a Mumbai based non-banking financial institution registered with the Reserve Bank of India. The Mortgage Financier began operating in 2010 and turned profitable in 2014. The value of the Company is more than Rs. 850 Crores.

SEBI has nodded to Home First Finance (HFFC) to raise 1500 Crore through the Initial Public Offering (IPO) route. The IPO consists of a new issue aggregating up to Rs 400 Crore and an offer for sale up to Rs 1,100 Crore by the selling shareholders. 

The Company had registered its Draft Red Herring Prospectus with SEBI on November 28, 2019. The DRHP also affirms that the Company may hold a pre- IPO placement of up to Rs 160 Crore in deliberation with the Book Running Lead Managers (BRLMs). The Undertaking of the pre-IPO will reduce the amount from the new issue.

The Company intends to utilize the net proceeds to expand its capital base to meet its future capital obligations that arise out of its business and assets' growth and receive the advantages of listing the equity shares on the stock exchanges.

5. National Commodity and Derivatives Exchange Ltd (NCDEX) 

National Commodity and Derivatives Exchange Limited (NCDEX) is an online commodity exchange established in India. It gives a commodity exchange platform for market shareholders to trade in commodity derivatives. It started operating on December 15 2013.

NCDEX has received capital market regulator SEBI's nod to launch the Rs 500 Crore IPO.

The offering comprises a fresh issue adding up to Rs 100 Crore with an offer for sale of up to 1.44 Crore shares, according to the draft red herring prospectus (DHRP). SEBI's observations are compulsory for any company to launch public issues like initial share sale, follow on public offer (FPO), and rights issue.

The Company had approached SEBI with its IPO papers in February. After BSE and MCX, this would be the third listing by an exchange. The public issue will be raising about Rs 500 Crore, including the fresh offering of shares, merchant banking resources said.

The book running lead managers to the offer are ICICI Securities and SBI Capital Markets. 

6. Lodha Developers 

Lodha Group Developers is an Indian real estate company with its headquarters in Mumbai, India. It has developed residential and business properties in Mumbai, Thane, Hyderabad, Pune, and London. The Company is credited for developing Palava, an integrated smart city near Mumbai. 

This leading real estate firm gears up to hit the capital market this month with its Initial Public Offer (IPO) to raise about Rs 5,500 Crore. The Company will issue new shares worth up to Rs 3750 Crore. The promoters will sell up to 1.8 Crore shares through the Offer for Sale (OFS) route. Market regulator SEBI gave its approval for the IPO on July 6, 2020.

If successful, Lodha's IPO would be the second-biggest IPO in the real estate sector after DLF that raised close to Rs 9200 Crore in 2007. Lodha would utilize Rs 3,300 Crore to retire its debt from the net returns of shares' fresh issue. The Company had an unpaid debt of nearly Rs 1800 Crore as of January end this year.

7. LIC IPO 

Life Insurance Corporation of India is an Indian State-Owned insurance and investment corporation owned by India's Government. 

Finance Minister Nirmala Sitharaman, while conferring the budget 2020-21 on Saturday, announced a stake sale in LIC through an initial public offer in the next fiscal year.

Market participants are in good spirits about the LIC IPO and said it could be the "IPO of the decade" corresponding to the Saudi Aramco listing. The Issue size of the IPO is Rs 70,000 Crore, and the face value of each share is Rs.10 per Equity Share. 

8. StoveKraft IPO 

StoveKraft Ltd is a kitchen solution and an emerging home solutions brand. The kitchen solutions comprise cookware and cooking appliances across brands, and home solutions contain various household utilities, including consumer lighting. 

Stove Kraft Ltd has received SEBI's approval to float its initial public offering. The public offer constitutes a fresh issue of equity shares aggregating up to Rs 145 Crore and an offer for sale up to 71,63,721 equity shares. 

The Company proposes to utilize the net proceeds from the new issue towards repayment or prepayment of individual borrowings availed by the firm and for other general corporate purposes. 

9. Nazara Technologies 

Nazara Technologies is the brain behind some popular games like Chhota Bheem, Motu and Patlu series, and the World Cricket Championship. SEBI recently gave its nod to Nazara Technologies IPO in 2020.

The IPO will issue 55.43 lakh worth of shares to the public and institutions. The face value of the equity shares issued by Nazara Technologies is Rs 4 per share.

10. The Park Hotels 

Park Hotels and Resorts is a real estate investment trust (REIT) centred on hotel properties. It is based out of Tysons, Virginia. It was established in 2017 as a spin-off from Hilton Worldwide.

The Company proposes an initial public offering to raise Rs 1000 Crore. The IPO comprises a fresh issue of up to Rs 400 Crore and an offer-for-sale (OFS) of up to 600 Crores. The amount to be raised through OFS involves up to Rs 125.4 Crore by promoter selling shareholder, up to Rs 354.9 Crore by Apeejay Pvt Ltd, up to Rs 84.7 Crore by Apeejay House Pvt Ltd, and Rs 34.9 Crore by investor selling shareholders, according to the draft red herring prospectus (DRHP).

The Company proposes to utilize the net proceeds towards repayment/prepayment of individual borrowings availed and for general corporate purposes. 

11. Bajaj Energy

Bajaj Group is a Mumbai based Indian multinational conglomerate company founded in 1926. It is one of the most traditional and biggest conglomerates in India. The group has various industries that include automobiles (2 and 3 wheelers), home appliances, lighting, iron and steel, insurance, travel, and finance.

The market regulator SEBI has approved Bajaj Energy to raise an estimated Rs 5,450 Crore through an initial share-sale offer.

According to draft papers, Bajaj Energy's initial public offer comprises fresh issuance of shares aggregating up to Rs 5,150 Crore and an offer to sell shares up to Rs 300 Crore Bajaj Power Ventures.

12. EaseMyTrip

EaseMyTrip is an Indian online travel company founded by Nishant Pitti and headquartered in New Delhi. The Company provides hotel bookings, air tickets, holiday packages, bus bookings, and white-label services.

EaseMyTrip has registered draft papers with capital markets regulator SEBI to float a Rs 510 Crore initial public offering. According to draft papers filed with the IPO, the Company's founders Nishant Pitti and Rikant Pitti will sell shares to the tune of Rs 255 Crore through an offer for sale mechanism of the Securities and Exchange Board of India (SEBI).

Conclusion 

On a concluding note, check out a few points to remember before investing in any IPOs:

Research the stock ahead of time:

Whether you want to invest in a high-profile stock or get something a little more low-key, it's important to research ahead. Study the fundamentals of the Company. Look beyond the excitement to check whether it's a profitable investment.

Read the prospectus:

While it might not be a fun thing to do, reading the prospectus does reveal some of the risks and challenges of investing. Do not skip this part of vetting an IPO because it can present you with a view of what to assume – and help you discover possible red flags. 

Check the broker:

IPOs have brokers helping them navigate the process. As you are considering an IPO, also look at who's bringing it to the table. Is the broker respected? Is he doing requisite due diligence? It is important to carefully consider how the broker examines the IPOs it brings to market. You will be more likely to see quality offerings even though they aren't prevalent or make huge profits.

Review prospectus:

Because you have been doing the research, you should be able to review the Company's prospects better. Take a survey at the market and business and study how the IPO matches into the scene. What benefits does the Company attach? When you decide to buy in an IPO, you want it to be a promising company and can withstand the test of time and be high-profit yielding.

Hence, it becomes important to review the Company's prospectus in order to analyze the situation better.

Wait until the end of the Lock-up Period:

Shareholders can't sell their shares in a private company going public until after a certain period has passed. So, if you do not see current shareholders dumping the stock, that's why. Even if a shareholder knows the stock will crash, they still cannot legally sell it during the lock-up period. Find out what the lock-up period is, and then consider waiting until it passes to see if the insiders start selling. You will refrain from purchasing the IPO, but it will be for the best.

Wait to see how the dust settles: 

Maybe you don't need to invest in the IPO immediately. Sometimes it can also be better to wait it out and see how situations work out. Suppose you remain patient for a few days. In that case, you might notice that the stock falls below the IPO price as the enthusiasm fades. You could strike up some bargains a week or two later and then profit down the road if the Company demonstrates its worth. 

To sum it up, an IPO can be an excellent way to get in early on a profit-making company. However, there are also dangers with buying something before the market has had time to vet it. Hence, it is always advisable to carefully do your investigation before you decide to buy an IPO.