IPO Ghodapur raises Rs 21.9 lakh crore in commercial paper market


MUMBAI: NBFCs are seeking massive financing through commercial papers to provide short-term funding to large investors to invest in IPOs. In the year 2021, through commercial papers, Rs. 31.5 lakh crore was raised, which is 9 per cent year-on-year and the highest since 2014.

According to the data, about 5 per cent of the commercial papers issued last year were for a period of 1 to 6 weeks. For an IPO, loans are usually lent for a period of 8 to 10 days.

Last year, six companies raised a record Rs. 1.50 lakh crore has been collected. The highest amounts were raised through commercial papers in July, August, November and December as the highest number of IPOs came in these months and they were around Rs. 5,000 crore was collected.

Market analysts say that last year's IPO Ghodapur lured wealthy investors, who had borrowed huge sums of money from NBFCs to invest in the IPO listing gain. For this reason, NBFC managed to raise funds through commercial papers.

Last year, 6 issues in 6 IPOs received more than 100 bids from high net worth investors. Out of these, 4 IPOs were listed at 100% premium while 3 companies returned 30% on the day of listing. On the first day of listing, 7 out of 7 companies received more than 10% return in the form of closing price. The average size of an IPO is Rs. 15 crore, which is the highest compared to previous years.

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