Photo: Abhijit Bhatlekar/Mint
Photo: Abhijit Bhatlekar/Mint

20 firms approach Sebi with public offer proposals

18 firms filed their initial papers with Sebi after the general election verdict was announced in mid-May

New Delhi: Looking to tap into the upbeat investor sentiment, as many as 20 companies including Videocon D2H, Rashtriya Ispat Nigam Ltd and Adlabs Entertainment have filed initial papers with market regulator Securities and Exchange Board of India (Sebi) for their public offers.

Since January this year, 20 companies have filed their draft red herring prospectus (DRHP) with Sebi to launch an initial public offer (IPO), while SMC Global Securities Ltd sought Sebi’s approval for its follow-on public offer (FPO).

Barring Sharda Cropchem and GMR Energy, other 18 firms filed their initial papers after the general election verdict was announced in mid-May. Sharda Cropchem filed its draft document in February and GMR Energy sought Sebi’s approval in March. However, GMR Energy withdrew its application in April.

Of these firms, Sebi has already given nod to the IPOs of Lavasa Corporation, Adlabs Entertainment, Ortel Communications and MEP Infrastructure Developers. However, these four companies are yet to launch their public offers.

Besides, the regulator has sought clarification or additional information from the merchant bankers of some of the companies. Most of the companies plan to utilise IPO proceeds for capacity expansion as well as working capital requirements.

Of these 20 firms, only two companies—Sharda Cropchem and Monte Carlo Fashions—got listed on the stock exchanges.

According to market experts, landslide victory of Bharatiya Janata Party (BJP)-led National Democratic Alliance (NDA) in the general elections has perked up investor sentiment and prompted companies to file IPO papers.

Analysts expect a spurt in IPO market next year because many firms which has received Sebi’s approval may launch their public offers in 2015. So far in 2014, the 30-share benchmark Sensex has gained over 28% spurred by robust fund flows and revival of risk appetite amid signs of improving economic conditions.