Merchant Banks Earn Rs 474 Crore From Groww, Lenskart PhysicsWallah, Pine Labs IPOs

India's primary market action has lately been gripped by four high-profile startups — eyewear retailer Lenskart Solutions, brokerage Groww’s parent Billionbrains Garage Ventures, ed-tech giant PhysicsWallah and fintech company Pine Labs — which recently concluded their initial public offerings.

The new-age tech companies had decent-to-mixed listings on D-Street after the conclusion of their IPO subscription windows. However, the four companies together have paid up to Rs 474 crore in merchant banking fees and commission for their recently launched issues, according to reports.

Groww emerged as the highest spender on banker fees at more than Rs 151 crore. Lenskart and Pine Labs followed with payments of Rs 128 crore and Rs 104 crore respectively, while PhysicsWallah paid Rs 89.8 crore to its issue managers, as per the report. The four mainboard IPOs mobilised Rs 21,290 crore last week.

Nearly 55% of all IPO expenses were directed towards merchant banking fees, said the report. The balance covered listing and regulatory charges, commissions to banks, processing fees of BSE and NSE, legal counsel costs, printing and stationery, and marketing and advertising outlays.

Shares of Groww have surged nearly 40% since it's blockbuster debut on the stock exchanges. Ed-tech giant PhysicsWallah shares jumped 45% upon listing. The new-age companies with robust global backings have attracted investors towards the IPOs. Notably, foreign portfolio investors have pumped over Rs 7,800 crore in India's primary market so far this month. This comes despite the continued sell-off by FPIs in Indian equities.

Merchant bankers have had an exceptional run this year as the primary market continues its record-setting spree with new public issues. Reports indicate that fundraising has already crossed Rs 1.5 lakh crore so far, with nearly 85 companies tapping the primary market.

Fresh capital raised via IPOs typically goes into the company's capex and is viewed as a sign of economic vitality. An offer for sale (OFS), on the other hand, represents a transfer of ownership, usually involving private equity investors or company's founders/promoters selling down their stakes.