- By Aditya Pratap Singh
- Wed, 09 Sep 2026 10:39 AM (IST)
- Source:JND
- Indian market declines third day; Sensex down 600 points.
- Booming IPO market major factor, sucking liquidity from indices
- Experts advise caution on IPOs and recommend large-cap stocks.
The domestic equity market continued its losing momentum for the third day this week as the key indices--Sensex, Nifty--traded significantly lower on September 9. Last seen, the BSE Sensex traded at 74,977.84, down 0.79 per cent or 599.73 points, while the Nifty50 was quoted at 23,482.15, down 152.95 points or 0.65 per cent.
One factor that anyone could predict weighing on market sentiment is elevated crude prices due to escalating tension in the Middle East. However, according to market watchers, the recent boom in India's primary or IPO market is one of the primary factors behind the current downturn, and it is a stronger factor than the former.
“Two strong headwinds are impacting the market now. One, Brent crude around $100 amidst escalating US-Iran tensions is weighing on the economy. Two, the booming IPO market is sucking liquidity out of the market, resulting in a sustained downtrend in the Nifty," Dr V K Vijayakumar, Chief Investment Strategist, Geojit Investments Limited.
"Perhaps, the latter is impacting the market more than the former," Vijayakumar emphasised.
Why IPO's Are Causing Liquidity Concern In Market
- The listing gains from IPOs, which have increased to about 22 per cent since June, are driving investors- both retail and institutional- into the IPO market. This is understandable since Nifty return YTD is negative 9.5 per cent.
- Even FIIs who have sold equity for Rs 284000 crores through the exchanges so far this year have put in about Rs 36000 crores in IPOs so far this year.
"Everyone is riding the momentum in the IPO market. This frenzy has pushed up the IPO valuations, too. IPOs are getting subscribed irrespective of valuations. Investors have to be discreet while applying for IPOs," Vijaykumar noted.
10 IPOs Opened This Week
In just three days this week, 10 main board IPOs have opened for subscription. This comprises:
| Company Name |
|---|---|
1 | Pranav Constructions Limited |
2 | Kanohar Electricals Limited |
3 | Glass Wall Systems (India) Limited |
4 | Prasol Chemicals Limited |
5 | Rentomojo Limited |
6 | Manipal Payment and Identity Solutions Limited |
7 | Steamhouse India Limited |
8 | Asset Reconstruction Company (India) Limited |
9 | Karamtara Engineering Limited |
10 | LCC Projects Limited |
Large Cap Vs IPOs: Where Should You Apply?
The analyst said that there are good and reasonably priced IPOs and investors can apply for these.
"But instead of blindly applying for all IPOs driven by FOMO, investors can now accumulate fairly valued stocks, particularly large-caps in growth sectors. Investing in these segments and waiting patiently will reward investors handsomely while many IPOs run the risk of going below the issue price. Discretion is the better part of FOMO," Vijaykumar said.