IPO Boom Expected in 2025 Amid Growing Demand for New Businesses

Pankaj Pandey, Head of Research at ICICI Direct, has expressed his confidence that India is poised for an IPO boom in 2025, driven by the growing appetite for newer businesses. According to Pandey, new-age business models will continue to drive the boom, with investors eager to invest in innovative companies.

Pandey is also bullish on the auto sector, citing the potential for premiumisation and Electric Vehicle (EV) adoption as tailwinds for growth. He expects an increase in spending from the government, which could lead to a decent earnings growth in FY25.

In terms of global trends, Pandey notes that while there are concerns about Donald Trump's presidency, Indian companies are likely to be less affected. However, he expects tax cuts under the new regime and increased discretionary spends in key sectors such as BFSI, Retail, and Telecom to drive growth in FY26.

Other sectors that Pandey is bullish on include:

• EPC (Engineering, Procurement and Construction)
• Capital goods
• Cement
• Banking, with lean balance sheets and majority of bad loan provisioning behind them

However, Pandey also warns that global geopolitical tensions remain a major threat to Indian equities. He expects minor corrections in the markets but believes they will remain supportive overall.

In terms of monetary policy, Pandey expects the RBI to cut rates by 75bps in the forthcoming rate-cut cycle, with a projected Repo rate of 5.75% by end-2025.

Overall, Pandey remains optimistic about India's growth prospects and believes that achieving full-year growth of 6.6 percent is achievable.