Investors’ interest in the stock market has gained momentum in the backdrop of the recent bull run of the Indian equity markets and handsome returns on investments.
In line with this upbeat mood, Gujarat’s SME IPOs have also seen a major surge in the last six months. From April to September this year, Gujarat’s small and medium enterprises raised Rs 616 crore through IPOs, which is at par with Rs 636 crore raised by these entities in the entire fiscal year 2022–23.
Gujarat now accounts for 26% of the funds raised by SMEs in India through initial public offerings (IPOs). According to investment consultants, the sizes of SME IPOs have also increased. Data from a stockbroking firm, Monarch Networth Capital Limited, headquartered in Ahmedabad, suggests that 28 SME IPOs were registered on the BSE SME platform and NSE Emerge, from across the country in FY2021, which increased 342% to 124 in FY2023. In the same period, the number of SME IPOs listed from Gujarat rose 725% from four entities to 33.
From April 1 to September 21 this year, Gujarat saw 22 SMEs listed.
In the past year, more SME entities raised funds through IPO channel. As a result, overall funds raised by entities are rising year after year.
Getting listed on stock exchanges not just facilitates SMEs to raise funds but also enables their business growth, gives them improved visibility and establishes their credibility. After SME IPOs get listed, their financial and corporate governance structure improves.
Equity markets have invariably piqued the interest of investors from Gujarat, which is also a manufacturing hub. Over the years as businesses became more efficient and professionally managed, SMEs charted their growth, which further strengthened investor confidence. As a result, Gujarat now has the highest share in SME equities.