Best Mainline IPOs: Returns and Subscription in last 5 years

How do you rank the best IPOs of the last 5 years. Obviously, there are many parameters, but we shall stay out of the qualitative parameters and stick to the quantitative parameters. They may appear to be prosaic, but they are certainly more reliable and also have the numbers to back them up. So, how do we evaluate the mainline IPOs of the last five years? One way is the extent of subscription. It is presumed that higher the subscription the better.

That may not translate into returns but it certainly is a good sign of the popularity of the IPO. Then we shall look at the returns. For simplicity, we shall not get into complications like CAGR returns or harmonic average returns. We will look at the pure returns from point to point, irrespective of the length of the time. Whether the IPO belongs to 2018 or to 2022, the returns will be calculated to the current date. Here are the best performing IPOs for the five calendar IPOs from 2018 to 2022, across all mainline IPO issues.

Best mainline IPOs by subscription and returns – Calendar year 2022

Let us first look at the top 10 IPOs based on the extent of subscription during the calendar year 2022; with a break-up of the subscription.

As can be seen from the table above, the over subscription has been relatively subdued in 2022 compared to some of the IPOs in 2021. Many of these were relatively smaller sized IPOs, so the IPO oversubscription has to be taken with a pinch of salt.

Let us now look at calendar year 2022 from the perspective of the best IPOs in terms of returns. As stated earlier, the returns would be point to point in all the cases and there would be no annualization or compounding factor inserted into it. Here are the 10 best IPOs by returns in calendar year 2022.

Even in a tough year, the returns have been fairly attractive for the year 2022. Interestingly, there is very little in common between the top IPOs of 2022 by subscription and the top IPOs of 2022 by returns to shareholders. Therein, perhaps likes a lesson that subscription matters only upto a point for return generation. What really matters is how much the issuers and the merchant bankers really leave on the table for investors.

Best mainline IPOs by subscription and returns – Calendar year 2021

Let us first look at the top 10 IPOs based on the extent of subscription during the calendar year 2021; with a break-up of the subscription.

As can be seen from the table above, the over subscription has been extremely robust in the calendar year 2021, something that could not be sustained in 2022. Many of these were relatively smaller sized IPOs, but even the larger digital IPOs saw impressive subscriptions, although the retail, HNI and institutional appetite was very strong in 2021.

Let us now look at calendar year 2021 from the perspective of the best IPOs in terms of total point to point returns. As stated earlier, the returns would be point to point in all the cases and there would be no annualization or compounding factor inserted into it. Here are the 10 best IPOs by total returns in calendar year 2021.

There is an interesting pattern in the total returns to rankers in 2021. Remember, these are returns till date, so they have an advantage over 2022, but that is OK. There are a number of focused defence companies and chemical companies in the top 10 returns list. Some of the stocks like MTAR Technologies and Paras Defence are there in the top ranking list by subscriptions and also by total returns.

Best mainline IPOs by subscription and returns – Calendar year 2020

Let us first look at the top 10 IPOs based on the extent of subscription during the calendar year 2020; with a break-up of the subscription.

As can be seen from the table above, the over subscription has been extremely robust in the calendar year 2020, although it is nowhere close to the levels of 2021. The year 2020 was also a rather volatile year due to the pandemic and the freeze on IPOs for a prolonged period of time. The recovery in IPOs in the second half of 2020 was quite sharp.

Let us now look at calendar year 2020 from the perspective of the best IPOs in terms of total point to point returns. As stated earlier, the returns would be point to point in all the cases and there would be no annualization or compounding factor inserted into it. Here are the 10 best IPOs by total returns in calendar year 2020.

What needs to be noted here is that much of the outperformance by stocks like Mazagon Docks has happened in the last one year when defence stocks have benefited from the government giving out defence orders more liberally to Indian companies. Happiest Minds and Route Mobile have plays on the new age technology while Angel One and Computer Age Management Systems Ltd (CAMS) have been solid plays on the emerging financialization of savings in the Indian economy.

Best mainline IPOs by subscription and returns – Calendar year 2019

Let us first look at the top 10 IPOs based on the extent of subscription during the calendar year 2019; with a break-up of the subscription.

As can be seen from the table above, the over subscription has been good for a handful of stocks but year 2019 was overall a tough year with the IL&FS crisis and the DHFL crisis having an impact on the IPO markets. That is evident if you see that the IPOs ranked eighth to tenth have only got single digit subscription overall. Retail subscription was overall tepid in the full year due to higher rates and other financial constraints.

Let us now look at calendar year 2019 from the perspective of the best IPOs in terms of total point to point returns. As stated earlier, the returns would be point to point in all the cases and there would be no annualization or compounding factor inserted into these calculations. Here are the 10 best IPOs by total returns in calendar year 2019.

Interestingly, some of the IPOs of 2019 have been true blue star performers in the last one year. IRCTC is a classic example of a company that was a play on the monopoly positioning and the property that was created on the digital space. Another play on the digital space was Affle, which his into the MARCOM business. Similarly, Indiamart has also been a play on the ecommerce B2B space, before it had become a wave in 2021. They are still outperformers, largely due to the more sedate pricing of the IPOs.

Best mainline IPOs by subscription and returns – Calendar year 2018

Let us first look at the top 10 IPOs based on the extent of subscription during the calendar year 2018; with a break-up of the subscription.

As can be seen from the table above, the over subscription has been good for a handful of stocks but year 2018 was overall a tough year with a lot of pressure on the retail side of the IPO markets. That is evident if you see that the IPOs ranked seventh to tenth have only got single digit subscription overall, with extremely tepid retail subscriptions. Retail subscription was overall tepid in the full year due to higher rates and other financial challenges.

Let us now look at calendar year 2018 from the perspective of the best IPOs in terms of total point to point returns. As stated earlier, the returns would be point to point in percentage terms in all the cases and there would be no annualization or compounding factor inserted into these calculations. Here are the 10 best IPOs by total returns in calendar year 2018.

Interestingly, some of the IPOs of 2018 have been true top performers as of date. Once again, there are 2 defence players in this list of top performers in 2018 viz, Hindustan Aeronautics Ltd (HAL) and Bharat Dynamics Ltd (BDL). There are also other government owned companies like RITES and Mishra Dhatu Nigam which have been among the top performers of 2018. Fine Organic is at the top but others like Garden Reach (another defence play) and HG Infra are also among the top gainers. The year saw some attractive pricing that has helped stocks gain in the post pandemic set-up.

Key takeaways from the rankings of last 5 years

What are some of the key takeaways from the mainline IPO rankings of the last 5 years. Here are some key points to note.

• Oversubscription was the best in the year 2021, which was the year of the IPO boom. However, the poor performance of the digital IPOs in 2021 led to lower subscription interest in the year 2022.
   

• The period between 2018 and 2020 were relatively tough for IPOs due to the financial crunch and then the pandemic. However, several IPOs of that period saw attractive pricing, which translated into higher returns over time.
   

• Lastly, there is not much of a direct linkage seen between returns and subscription levels. While there seems to be some random level of relationship, where is no guarantee that higher subscription means higher returns. It eventually boils down to how much is left on the table for investors in the pricing story.