India's IPO Market Set for $20 Billion Annual Issuance, Says JP Morgan

India's primary market is poised to embrace initial public offerings (IPOs) amounting to approximately $20 billion per year, according to projections from JP Morgan. This trend, described as a new normal, is expected to establish itself as a consistent annual rate over the coming years. The investment bank reported that the market has already seen IPO issuances worth $21 billion in 2025, matching the previous year's total. It anticipates closing the year with over $23 billion, bolstered by significant offerings such as the ₹10,000 crore (approximately $1.2 billion) planned by ICICI Prudential Asset Management Company.

Abhinav Bharti, Head of Equity Capital Markets at JP Morgan, stated, "Yearly issuance of $20 billion is the new watermark for India and will become an annualised run rate from here on." He noted that nearly 20% of the current demand for IPOs is being driven by consumer technology and new-age businesses. This proportion is expected to rise above 30% in the next five years.

At present, around 20 startups with valuations in the hundreds of millions of dollars are preparing to enter the public market, with four to five of these companies expected to target IPOs exceeding $1 billion each. Collectively, they may raise up to $8 billion, with two of these firms being technology-driven.

Discussing market valuations, Bharti remarked that the Indian market has largely addressed previous challenges faced by new-age businesses, indicating that some recent IPOs advised by the bank are trading at a premium. He cited the investments made by private equity firms in prior years as a key factor sustaining strong IPO activity.

Addressing concerns about the predominance of offer-for-sale structures in recent IPOs, which reflect the sluggish pace of private capital expenditure, Bharti acknowledged the muted fundraising through qualified institutional placements (QIPs). Overall, the equity capital market landscape, which includes follow-on offerings and institutional placements, has been soft in 2025. Total equity issuances are projected to be around $65 billion this year, down from $72 billion in 2024, primarily due to a decline in QIP activity. Only $10 billion has been raised through QIPs thus far, compared to over $22 billion last year, with $3 billion attributed to the State Bank of India alone.

JP Morgan also expressed optimism regarding the return of foreign portfolio flows to Indian markets in the coming year, citing improved valuations relative to other markets. The bank views India as a defensive investment opportunity, particularly as global investors seek prospects amid the artificial intelligence boom in developed economies.

Looking ahead, the overall market capitalisation of India is projected to double to approximately $10 trillion within the next five years, positioning it as the third-largest market globally, following the United States and China. Nitin Maheshwari, Co-Head of Investment Banking at JP Morgan, highlighted the growing momentum in outbound mergers and acquisitions, underpinned by strong corporate balance sheets and low leverage. He noted that Japan and the Middle East show significant interest in Indian markets, particularly in the financial services sector.