2024 IPO Performance: is a New IPO Worth the buying?

The chart above clearly indicates that IPOs are becoming increasingly oversubscribed year by year. In 2022, the average subscription rate was 8.72x, which has skyrocketed to 32.11x in 2024. These numbers highlight the growing interest of retail investors, likely driven by expectations of listing gains. However, this raises an important question: which IPOs are seeing such high levels of oversubscription?

Most Subscribed IPOs by Retailers in 2024

Now that we know retailers subscribed the IPOs by 32.11x on an average in 2024, the Below table will help us understand which IPOs were most liked by retailers.

These numbers reveal a remarkable level of enthusiasm from retail investors. BLS E-Services led the pack with an astonishing 237x subscription, indicating significant investor confidence. Other IPOs like Vibhor Steel Tubes and Manba Finance also saw massive oversubscription, suggesting that investors are highly attracted to these IPOs, likely driven by the expectation of strong listing gains.

Popular IPOs Ignored by Retailers

Retail investors might have oversubscribed many IPOs, but they largely stayed away from some of the most high-profile offerings of the year. Among these was Hyundai, the largest-ever IPO in the history of the Indian stock market, which saw only 0.5x subscription by retail investors. Similarly, Swiggy, another much-anticipated IPO, managed just 1.1x subscriptions from small investors. This highlights how factors such as IPO timing and pricing can influence retail participation, even for popular companies.

But this raises an intriguing question: Do these IPOs deliver the listing gains that retail investors are hoping for? Let’s explore the listing gains provided by IPOs in 2024 to uncover the answer.

IPO Listing Gains/Loss 2024

In 2024, IPO was one of the instruments to make money for the retailers. But did they make money out of it? Let us find out!

Do these IPOs actually deliver the listing gains that retail investors are hoping for? The data suggests that a significant number do, as 72 IPOs in 2024 posted positive returns on their listing day. Among these, 7 IPOs delivered exceptional gains exceeding 100%, and 8 IPOs offered impressive returns between 50% and 100%. Additionally, 57 IPOs provided more moderate but still favorable gains of up to 50%, showcasing the potential rewards for retail investors.

However, it’s worth noting that 16 IPOs failed to meet expectations, posting negative returns, with losses ranging from 0% to -20%. This underscores that while many IPOs can be lucrative, not all live up to the hopes of listing gains, making careful selection critical for investors.

With the majority of IPOs delivering listing gains, which ones provided the highest returns, and which ended up in the red? The answer lies below.

Best and Worst Performing IPOs of 2024

The public offerings have given exceptional returns but which ones gave the most return?

Which is the best performing IPO of 2024?

Vibhor Steel Tubes

The top-performing IPO of 2024 was Vibhor Steel Tubes, a company from the steel sector. It was launched on February 20, 2024, and received an incredible subscription rate of nearly 299x. On its listing day, it offered a remarkable gain of 181%.

However, After the listing the stock has shown weakness with continuous fall. As of now, the stock is trading 50% below the listing at the price of Rs 206 (As of 10 Jan 2025). Now, let’s take a look at the other top gainers that followed this strong performance.

Other Top Performing IPOs

Mamta Machinery

Mamta Machinery, a manufacturer of plastic bag-making machines listed its IPO successfully in December 2024 with an increase of 147% from its issue price of Rs 243.

Despite the good start, the stock has found itself in the overall market fall since December. At present, the stock price is trading at 448 (As of Jan 10, 2025), below 25% from its listing price.

BLS E-Services

A subsidiary of BLS Internationals, BLS E-Services, is listed at the price of Rs 305. Reaching more than 126% from its issue price of Rs 135.

However, with a consistent fall after the listing gains, the stock has now reached Rs 201 Levels (CMP as of Jan 10, 2025). Which makes the loss over 32% since the listing.

In 2024, 72 IPOs gave more than 1% listing gains to the investors. However, there were a few IPOs which have disappointed its investors.

Worst Performing IPOs of 2024

• R K Swamy Ltd., with a total subscription of 25.9x, opened with a 13.2% loss. The stock has experienced fluctuations since its listing and is currently trading at ₹250, hovering around its break-even point.

• ACME Solar Holdings, listed in November with a total subscription of 2.8x, opened with a 13.1% loss. The stock has continued to decline and is currently trading at ₹230, which is 8% below its listing price.

• Godavari Biorefineries, launched in October with a total subscription of 1.8x, listed with a 12.5% loss. Since then, the price has declined further, and it is currently trading at ₹282, which is 8% below its listing price.

Conclusion

In conclusion, the IPO market in 2024 presented a mixed bag for retail investors. While the majority of IPOs delivered listing gains, with several offering exceptional returns, some failed to meet expectations, highlighting the inherent risks of investing in new public offerings. Retail enthusiasm remains strong, as evidenced by high subscription rates, but careful evaluation of individual IPOs is crucial. The contrasting performance of top gainers like Vibhor Steel Tubes and underperformers like R K Swamy Ltd. underscores the importance of timing, market conditions, and stock selection in maximizing gains from IPO investments.