When companies intend to raise money from the market for increasing capitalization, expansion, restructuring or settling liabilities, they release stocks that can be purchased by both individuals and institutions. At the time of release of a new Indian IPO, there’s a rush to buy it and a lot of people await big IPO releases. But it’s essential to track IPOs well in advance, so that there’s ample time to research about the stock and explore options. Prior to investing in an IPO, it’s best to get info about company performance, investor history, balance sheets, debt, assets, liquidity etc. At the beginning of a new financial year, the stock market usually shows promise and a lot of companies announce the release of their IPOs.
Here are 3 upcoming hot IPOs to buy in 2021
Bajaj Energy IPO will be released this year. The IPO size would be around Rs. 5,450 crores. Bajaj Energy is eyeing project expansion and is most likely releasing the IPO for that reason. From the money raised by the IPO, the company will acquire Lalitpur Power’s 1,980 MW unit. Energy sector shows growth prospects for the future, so for those looking for long-term growth, Bajaj Energy IPO could be a good option. It’s one of the awaited hot new IPOs.
The IPO of Life Insurance Corporation of India will be released this year, announced Finance Minister Nirmala Sitharaman in her annual budget speech. Over 10% of the issue will be reserved for LIC policy holders. India’s biggest and oldest insurance provider going public would be among the most awaited IPOs of the year. Insurance sector in India is growing at a rapid pace and LIC is a valued name. Those eyeing investments in the insurance sector, should wait for the rollout of LIC IPO. The government expects to raise Rs. 80,000 crores from the IPO. LIC is among the most-sought upcoming hot IPOs.
The Kerala-based jeweller has already filed the draft prospectus for IPO worth Rs. 1,750 Crores. The company intends to raise over Rs. 1,000 Crore via IPO release and its two main promoters will sell their stakes worth Rs. 250 Crore and Rs. 500 Crores respectively. The stock would be public this year, though the exact release date is not known yet. Operational revenue of Kalyan Jewellers is Rs. 10,181 crores, while last year it was Rs. 9,814 Crores.
How to check for hot IPOs in 2021?
Apart from these three, a lot many IPOs would be released that you can invest in. Here’s how to check for upcoming hot IPOs.
Red Herring Prospectus
If you have made up your mind about the IPO that you want to buy, then the next step is going through the draft red herring prospectus (DRHP) to grasp all essential takeaways about the company. As per SEBI (Securities and Exchange Board of India) guidelines, it is compulsory for all companies that want to issue IPOs to release the DRHP. It provides all the relevant financial information about the company that you need to know before investing: company’s past, growth avenues, management structuring, founders, vision, challenges, top management, market reputation. Once you are done with tracking hot new IPOs, you should check out the DHRP.
A lot of financial websites and stock market advisory platforms come up with an IPO calendar, which is a smart and easy way to know about all the IPOs to be released in a calendar year. The IPO calendar includes the date and the month of release as well, so that buyers can well plan in advance and get ample of time to do their own research about the stock, check the company’s record and decide accordingly whether or not investing in it would be a good decision. You can track upcoming hot IPOs via IPO calendars.
National financial mainlines are published daily and contain most up-to-date information along with opinion pieces and market analysis by experts. Most of these newspapers are available in the digital format as well, and in case you are awaiting IPO releases of some prominent company, and they cover it along with market expectations and reactions. Referring to digital editions of financial papers to track hot new IPOs in 2021 is a good option.
All stock exchanges like BSE, NSE have special sections that provide information about IPOs. Fetching information straight from exchange websites is preferable to other methods because it is frequently updated and is bound to be more reliable than others. Official IPO prospectus can also be downloaded from exchange websites. For knowing about all upcoming hot IPOs, checking different exchange websites is a better option than just sticking to one. One of the limitations of exchange websites is that since they upload information only after a rigorous verification process, there may be some delay in recent information. Exchange websites are widely preferred to get to know about hot new IPOs.
The giant search engine has become a one-stop destination for all sorts of information. It has revolutionized information sharing. Relevant information regarding upcoming hot IPOs can be found on Google, along with recent news, analysis, expert opinion, commentary or any unpredictable event that may impact the IPO. Google’s dedicated news feed, known as Google News, is a good way to track hot new IPOs and get latest information about them. On Google News, there’s an option to feed the topic that you are interested in and it displays all the recent happenings. If you know what precisely you are looking for then you can feed that, else just creating a personalized news alert for IPO would do. One of the main advantages of Google News is that it’s not limited to any stock exchange or even geography.
People await upcoming hot IPOs slated for the year and make their financial plans accordingly. While figuring out hot new IPOs to buy, it’s essential to cross-check about the company and read its financial statements in detail. In order to diversify your stock portfolio and to reduce risk, it’s better to invest in hot new IPOs across different sectors. Energy and insurance are two sectors that are poised to show growth in the future, and Bajaj Energy and LIC are big and reputed players in these segments. If you plan to invest in an IPO in 2021, research thoroughly about the company’s background and its reason for going public.