IPO boom: $20 billion a year becomes India’s new normal; JP Morgan sees pipeline stay strong

India’s primary market is settling into a fresh groove, with annual IPO issuances of around $20 billion emerging as a structural trend rather than a one-off spike, according to JP Morgan, reported PTI.The investment bank said India has already seen $21 billion worth of IPOs in 2025, matching last year’s level, and is likely to close the year with over $23 billion in issuances as large offerings, including ICICI Prudential AMC’s planned Rs 10,000-crore issue, move ahead.“Yearly issuance of $20 billion is the new normal for India. It is the new watermark and will become an annualised run rate from here on,” JP Morgan’s head of equity capital markets Abhinav Bharti told reporters in Mumbai, PTI quoted.Bharti said nearly 20 per cent of IPO demand is currently coming from consumer technology and new-age businesses, a share that could rise above 30 per cent over the next five years. At least 20 startups with private market valuations running into hundreds of millions of dollars are preparing to tap the markets, he added.Among these, four to five companies are gearing up for IPOs of over $1 billion each, with the combined fundraise potentially reaching $8 billion. Two of these large issuances will be from technology-driven firms, according to Bharti.On valuations, he said the Indian market has largely resolved challenges faced in the past by new-age businesses, noting that some recent issues advised by the bank are trading at a premium. He also pointed to private equity investments made in earlier years as a key driver sustaining a strong pipeline of IPO exits.Bharti acknowledged that a significant share of recent IPO activity has been offer-for-sale by existing investors, reflecting sluggish private capital expenditure and muted fundraising through qualified institutional placements. He said overall equity capital market activity, including follow-on offerings and institutional placements, has been softer in 2025.Total equity issuances this year are expected to be around $65 billion, down from $72 billion in 2024, largely due to a decline in QIPs. QIP fundraising has dropped to $10 billion so far this year, compared with over $22 billion last year, with $3 billion coming from State Bank of India alone, he said.JP Morgan expects foreign portfolio flows to return to Indian markets next year, citing relatively improved valuations. The bank also sees India as a defensive investment destination for global investors amid the artificial intelligence-driven boom in developed markets.India’s overall market capitalisation is projected to double to about $10 trillion over the next five years, becoming the world’s third-largest after the US and China, JP Morgan’s co-head of investment banking Nitin Maheshwari said.On mergers and acquisitions, Maheshwari said outbound activity is gaining traction, supported by strong corporate balance sheets, low leverage and rising confidence among Indian companies, with Japan and the Middle East continuing to show the strongest inbound interest, particularly in financial services.