Are FII investing in IPO

A large pipeline of IPOs and FPOs has been building up during the second half of 2024.2. The experts predict that the momentum will continue in 2025, with the composition biased towards IPOs and QIPs, based on the block trade trends seen in 2024.

FIIs are expected to continue showing interest across multiple roadshows, boosted by participation from India-dedicated foreign portfolio investors who have seen strong inflows.4. The strong macroeconomic policies, decreasing global inflation, easing interest rates, and the growth of new-age companies are cited as major drivers for the growing appetite of foreign investors in the IPO market.So in summary, the document suggests that the ECM deal momentum is expected to continue in 2025, with a focus on IPOs and QIPs, as FIIs look to participate in these opportunities.

Foreign institutional investors (FIIs) adopted a two-pronged approach in 2024 – booking profits in the secondary market while placing bets in the equity capital market (ECM) through initial public offerings (IPOs), follow-on offerings (FPOs), and qualified institutional placements (QIPs). Despite being net sellers in the secondary market, FIIs contributed to around 47% of anchor allocations in IPOs in 2024. They saw IPOs and FPOs as opportunities to pick up larger exposure to growth stocks at reasonable valuations. FIIs also participated actively in QIPs and block deals, taking advantage of discounted prices. The strong macroeconomic policies, growth of new-age companies, and healthy listing gains have driven the increasing appetite of foreign investors in the Indian IPO market