The main market in India is expected to come alive after low activity after a period of few weeks. Three companies will be preparing to collect more than 1,750 crores of money by launching their first public offerings (IPOs) next week. The products, which include consumer goods, textiles and logistics, are being regarded as a sentinel test of what lies ahead in terms of investor sentiment during a possibly hectic November on Dalal Street.
The three listings, Orkla India Ltd, Game Changers Texfab and Jayesh Logistics Ltd, are a diversified combination of large and SME issues and are an indication of a wide-based confidence back to the markets.
Orkla India: The Weekly Heavyweight
The focus is squarely on Orkla India, which is going to raise nearly 1,667 crore using a 100 per cent Offer for Sale (OFS). This does not imply the business will be getting new capital as such; rather, current stockholders will be selling their interests. The problem is likely to generate a high institutional following, considering the presence of Orkla in the consumer goods market and its brand portfolio.
Analysts indicate that the lack of a new issue may hamper in the short-term capital injection in the business, but the listing may increase the brand visibility of Orkla India in the public markets.
SME Buzz: Game Changers Texfab and Jayesh Logistics Join the Game
Two small and medium enterprises (SME) IPOs are also going to be subscribing alongside the mainboard giant, which includes Game Changers Texfab Ltd and Jayesh Logistics Ltd.
Game Changers Texfab is a company that deals with textile manufacturing and is focused on raising approximately 55 crore. The company will use the proceeds to purchase more capacity and working capital and renew its production lines. The textile industry that has received a new deal of exporting and government subsidies for local production may attract value seekers.
In the meantime, Jayesh Logistics Ltd is aiming at approximately 28.6 crore. As it is placed in the logistics and supply-chain segment, the company will use the money to grow its operating fleet and enhance its warehouse facilities. With the growing need to connect with customers on a last-mile basis and supply-chain efficiency, Jayesh Logistics would be in a good position during the Indian logistics boom.
Renewed Market Confidence
These IPOs are well timed. The investors are being drawn back into the fold following a comparatively subdued period in the primary market, by the buoyant secondary-market performance and fresh liquidity. The diversification of the mix of sectors, including the consumer and textile, to logistics, indicates a sound diversification and trust in the Indian growth tales.
According to market experts, institutional and retail investors in these offerings will be under close observation. There is a good indication of a recovery in investor appetite. It will only be known in the next two weeks whether the comeback is as strong as it is being reported or not, said a market strategist in Mumbai.
Investor Takeaways
As an investor, the next week provides a sampling of prospects – a mature consumer goods player to new growth opportunities in the SME market. Nevertheless, analysts warn that discipline in valuation and selective involvement will be important, particularly in SME issues, which are generally more volatile and liquidity risky.
The problem of Orkla might be of interest to investors who need stability and brand strength, whereas Game Changers Texas fab and Jayesh Logistics would fulfil the need of the investor to get an early exposure to a fast-growing and smaller business, said another analyst.
The Road Ahead
The latest offering of IPOs can be only the start. More than a dozen companies are in regulatory limbo, and major consumer tech, engineering and financial service firms should enter the market before the year is over.
With such a gain in the market, the IPO calendar in India would have a robust completion in 2025, as one of the most vibrant equity markets in the Asian region.
The three issues next week will not be merely over the process of raising 1,750 crore but a gauge of investor trust, market depth and the newfound hope that is driving the Indian capital markets.
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