Upcoming IPOs to Look out for in November 2021

The initial public offerings (IPO) frenzy that India is currently witnessing is likely to reach new heights around Diwali. A handful of companies are preparing to go public in November 2021.

From the current trends we can see that the primary market is gearing up for a slew of Indian start-ups looking to raise money via IPOs.

Following the success of Zomato's listing, many of these new-age businesses are readying IPO plans. Three large start-ups - Nykaa, PolicyBazaar, and Paytm - will wrap up their share IPOs in November itself.

Over 60 companies have hit the stock market and have been listed on the National Stock Exchange between 9 November 2020 and 25 October 2021.

Retail investors have participated in large numbers in these IPOs. Applying for shares in IPOs has become easy thanks to the digital process.

The surge in the participation is also due to the huge influx that central depository services (CDSL) and national securities depositories (NSDL) saw in their user base during the lockdown period.

That apart, positive market sentiment and ample liquidity has also resulted in a favourable capital market environment for companies to go public.

Let us take a look at the IPOs expected in November 2021.

#1 Paytm

Paytm is expected to roll out its massive Rs 183 bn IPO on 8 November 2021. The fintech giant has fixed the price band of Rs 2,080-2,150 apiece for the public offer.

Paytm is eyeing a valuation of Rs 1.44 lakh crore - Rs 1.48 lakh crore. The company is issuing shares worth Rs 83 bn. Existing shareholders will sell shares worth Rs 100 bn from the offer for sale (OFS).

The company has proposed to use Rs 43 bn for growing and strengthening the Paytm ecosystem, including acquisition of consumers and merchants and providing them with greater access to technology and financial services.

Paytm plans to earmark Rs 20 bn for business initiatives, acquisitions, and strategic partnerships and up to 25% of the total fund raised through the IPO for general corporate purposes.

#2 Sapphire Foods

The initial share-sale of Sapphire Foods India, which operates KFC and Pizza Hut outlets, will open for public subscription on 9 November 2021.

The company has fixed the price band at Rs 1,120 and Rs 1,180 per share. It's planning to raise Rs 20.7 bn through its IPO.

Sapphire Foods, an omni-channel restaurant operator and the largest franchisee of Yum! Brands in the Indian sub-continent. It's backed by investors such as Samara Capital, Goldman Sachs, CX Partners, and Edelweiss.

Devyani International, which is the other franchisee of Yum! Brands in India, operates 297 Pizza Hut stores and 264 KFC stores. It launched its Rs 18.4 bn IPO in August.

#3 Latent View Analytics

The Rs 6 bn IPO of Latent View Analytics, a global digital analytics firm, will open for subscription on 9 November and close on 11 November.

The firm plans to list on 22 November. The IPO consists of a fresh issue of Rs 4.7 bn and an OFS of up to Rs 1.3 bn by its existing shareholder and promoters.

Proceeds worth Rs 1.5 bn from the issue will be used for funding inorganic growth initiatives, Rs 824 m for funding working capital requirements of its material arm Latent View Analytics Corp, and Rs 1.3 bn for investment in its arm to augment its capital base for future growth.

The firm is among the leading pure-play data analytics companies in India. It has emerged as one of the most trusted partners for several Fortune 500 companies in recent years.

It provides services primarily to companies in technology, CPG and retail, industrials, and the banking, financial services and insurance industries.

It has a diversified base of 45 active clients worldwide that it served in the financial year 2021, including 21 of the Fortune 500 and three of the Fortune 1,000.

#4 Prudent Corporate Advisory Service

Retail wealth management firm Prudent Corporate Advisory Services is planning to launch its IPO in the second half of November.

It will see private equity firm TA Associates making partial exit. The IPO could hit the market between 15 and 30 November 2021.

The company, which filed its preliminary IPO papers with markets regulator in August, said the public issue is entirely an OFS of 8.5 m equity shares. The main objective of the initial share-sale is to provide some partial exit to the private equity firm.

In addition, the public issue will help in enhancing visibility and awareness of the company's brands and in providing new opportunities to expand growth initiatives.

Prudent is one of the leading independent retail wealth management services groups (excluding banks) in India. It's among the top mutual fund distributors in terms of average assets under management and commission received.

The company provides wealth management services to 7.73 lakh retail investors through 17,583 mutual fund distributors (MFDs) on its business-to-business-to-consumer platform. It has branches in 105 locations in 20 states in the country.

#5 Emcure Pharmaceuticals

Emcure Pharmaceuticals filed its draft red hearing prospectus (DRHP) with market regulator to raise funds via IPO in the month of August.

According to sources, the offer size could be up to Rs 45 bn to Rs 50 bn. The IPO comprises fresh issuance of equity shares worth Rs 11 bn and an OFS of 10.8 m shares by promoters and existing shareholders.

Proceeds of the fresh issue will be used towards the payment of debt and for general corporate purposes.

Emcure Pharmaceuticals is engaged in developing, manufacturing and marketing a broad range of pharmaceutical products across many therapeutic areas.

The company has a presence in 70 markets globally. The Pune-based company is currently developing an RNA vaccine for Covid-19 through its subsidiary Gennova Biopharmaceuticals.

#6 CMS Info Systems

Market regulator has issued final observations on the draft papers filed by CMS Info Systems to raise Rs 20 bn via IPO.

The observations were issued last week on 29 October 2021, the watchdog mentioned in a statement. This is the final step before the company can float its IPO.

CMS Info Systems had filed DRHP on 14 August 2021. After receiving the final observations from the market regulator, or approval in common parlance, the Baring Private Equity-backed company will be allowed to file the red herring prospectus for its IPO.

The IPO consists entirely of an offer for sale of up to Rs 20 bn by Sion Investment Holdings Pte, an affiliate of Baring Private Equity Asia. Currently, Sion Investment Holdings holds 100% stake in the firm.

CMS offers ATM and cash management, ATM installation, maintenance and card personalisation services. Over the past decade, the company has been owned first by Blackstone, which took a controlling stake in 2008.

Later, it was taken over by Baring, which bought the company in 2015 for about Rs 20 bn.

#7 MobiKwik Systems

Last month, MobiKwik received markets regulator's approval to launch an IPO, through which it plans to raise up to Rs 19 bn.

Through the IPO, the company plans to offer shares aggregating to Rs 19 bn. Out of the total, Rs 15 bn will be mopped up through fresh issue of shares, while Rs 4 bn worth stocks will be offloaded through the OFS.

Proceeds from the fresh issue of shares will be used towards funding organic as well as inorganic growth initiatives and general corporate purposes.

One MobiKwik Systems is a leading mobile wallet (MobiKwik Wallet) and Buy Now Pay Later (BNPL) player in India.

The company is focused on addressing the unmet credit needs of the fast growing online transactors by combining the convenience of everyday mobile payments with the benefits of BNPL.

IPO market is booming in India. Will the trend continue?

Following the recent correction, the Indian stock market is still currently trading high and IPOs are attracting some wild valuations.

Given the abundant liquidity, the market regulator easing listing procedures and overall bullish sentiments, the IPO craze is understandable.

Data suggests that companies raised funds to the tune of US$4.6 bn from IPOs last year. The market believes this amount will be easily surpassed in 2021.

As companies line up to raise funds from the market amid high valuations, investors need to consider many factors before investing their money in an IPO.

If you are investing in an IPO, weigh in all the positive and negative factors affecting the company.

Take a close look at the company's financials and valuations. It would give you a clear picture of what's brewing.

Happy Investing!

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