Daily Voice | 2022 too will be robust for IPOs but Paytm listing is a wake-up call, says Sonam Srivastava of Wright Research

Daily Voice | 2022 too will be robust for IPOs but Paytm listing is a wake-up call, says Sonam Srivastava of Wright Research

Sonam Srivastava, Co-founder, Wright Research, says Paytm’s negative listing should be a wake-up call for companies to justify valuation because the market can punish them.

In the worst IPO listing day performance in India in recent memory, Paytm operator One 97 Communications’ stock tanked 27 percent to Rs 1,560 from the issue price of Rs 2,150 on November 18. One 97 Communications’ Rs 18,300-crore IPO was the country’s biggest even as some investors questioned its valuation.

Srivastava, a quantitative investment management and trading professional, thinks India’s growth story is intact. In an interview to Moneycontrol’s Sunil Shankar Matkar, she says India's Q2FY22 GDP is expected to be in the 7-9 percent range. Edited excerpts:

More than Rs 36,000 crore have been raised through IPOs in November. Do you see the primary market taking a break, especially after Paytm’s disappointing market debut? Which initial public offerings, other than LIC, are expected in the coming months?

India has raised more than $10 billion in funds from the public markets this year, which has been the highest in the last 20 years. However, in the week gone by, we have had the only major disappointment in IPO flows which was Paytm. Paytm has been severely criticized for its sky-high