Iran War to Slow Near-Term ECM Activity, Recovery Expected: Avendus Capital MD

• Avendus Capital MD Gaurav Sood states the Iran war will slow Indian ECM activity in the near term, but recovery is likely as risks are priced in.
• Despite volatility, 16 issuances this quarter raised Rs 23,000 crore, indicating continued market activity.
• Domestic liquidity supports smaller IPOs, while larger deals may face valuation pressure due to weaker foreign interest.
• REITs and InvITs are emerging as key beneficiaries, with SEBI's reclassification of REITs as equity instruments broadening investor base.
• InvIT IPO fundraising could exceed Rs 25,000 crore in 2026, driven by investor appetite for yield-backed real assets.

Key Questions Answered

How might global geopolitical events beyond the Iran war influence India's ECM activity in the long term?

Global geopolitical events beyond the Iran war could influence India's ECM activity through potential infrastructure opportunities in post-war rebuilding[2] and shifts in energy cooperation, such as

What specific policy measures could further enhance domestic liquidity and investor participation in Indian IPOs?

Reintroducing open market buybacks and easing FPI settlement norms could enhance domestic liquidity and investor participation in Indian IPOs [1][3][4].

Beyond real estate and infrastructure, which other sectors could benefit from the InvIT and REIT investment model in India?

Beyond real estate and infrastructure, the InvIT and REIT investment model could benefit the logistics and warehousing sectors[1]. NDR InvIT Trust has already raised funds for expanding its warehouse portfolio[1].