IPO Buzz Fizzles: Ather Energy Stumbles, JSW Cement & LG India Among 58 Firms To Hit Pause Amid Tariffs & India-Pak Tensions

India's IPO market is facing a significant slowdown, with at least two initial public offerings (IPOs) worth $759 million expected to be delayed, according to investment bankers told Reuters.

Companies like education loan provider Avanse Financial Services and contract drug maker Anthem Biosciences are among those deciding to postpone their listings due to weak investor sentiment.

These delays add to the growing list of Indian firms putting their IPO plans on hold, including JSW Cement, South Korean conglomerate LG Electronics' India unit.

India- Pakistan Tensions

Suraj Krishnaswamy, managing director of investment banking at Axis Capital, noted that “there are only select institutional investors coming in at this point given the global uncertainty.”

He also highlighted that the ongoing India-Pakistan tensions have not helped the situation.

The delays reflect a larger trend of how global trade wars and geopolitical tensions are clouding the economic outlook, pushing companies to reassess their capital raising and investment plans.

Ather Energy IPO Listing

Even the highly anticipated IPO of electric scooter maker Ather Energy, seen as a barometer for investor appetite, didn’t ease market concerns.

The company’s stock fell by around 5% in early trading, reversing gains after listing at a modest 2% premium to its issue price of Rs 321 rupees.

Vinit Bolinjkar, head of research at Ventura Securities, commented, “The muted listing for a high-profile EV name highlights the broader weakness in India’s primary market.”

58 Companies Delayed IPOs

In total, 58 companies with Indian regulatory approval have delayed their IPOs due to global market disruptions, including U.S. President Donald Trump ’s tariffs, which have negatively impacted business sentiment.

Avanse Financial Services received approval for its $356 million IPO in October 2024, while Anthem Biosciences was cleared to raise $403 million in April 2023. Neither company responded to Reuters’ requests for comment.

Pranav Haldea, MD of PRIME Database Group, noted that some firms may have to restart their entire IPO process or seek an extension from India's market regulator, as the regulatory clearances for several companies are set to expire in the coming months.

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India World's Second-Largest IPO Market

India, which was the world’s second-largest IPO market last year, has seen a 58% slump in IPOs listed on the main stock exchanges this year, according to PRIME Database.

The total fundraising on all listing platforms has also seen an 18% drop, as reported by LSEG data.

Despite the slowdown, there is some cautious optimism in the market. An anonymous investment banker said, “Things are moving slowly, but it is not a complete standstill. In the current scenario, most of the IPOs are in a similar situation.” Executives also share this view.

“You don’t want to file (for IPO) when you do not know how long the volatility will last,” said Droom CEO Sandeep Aggarwal, referring to his firm’s decision to delay filing its IPO papers originally scheduled for June.

Retail Investors Cautious

Retail investors, having suffered significant losses due to market volatility, are also becoming more cautious with new investments, leading to a lukewarm reception for this year’s IPOs. 

Ather Energy, which decided to go ahead with its $352 million IPO despite the uncertain environment, had to cut its target valuation by 44% and reduce the offer size.

Hem Securities senior research analyst Astha Jain warned, “Ather can be a risky bet given the current geopolitical issues and high valuation.”

While the Nifty 50 index has increased 4.8% since April 2, following U.S. President Donald Trump’s announcement of “reciprocal” tariffs, it remains 7% down from record highs seen in late September. 

The unpredictable environment has led bankers to urge prospective IPO clients to reconsider their strategies.