As many as 128 initial public offerings garnered USD 5.24 billion this year until August and going forward the IPO momentum is expected to improve in the coming months, says an EY report. According to the India IPO Market Insight report by EY, the IPO activity in the third quarter this year registered a significant decline vis-a-vis the corresponding period last year. Only three IPOs were launched on BSE and NSE in the third quarter of 2018 versus 11 public offerings in the same quarter of 2017. A similar trend was witnessed in the SME segment too. There were 19 IPOs in the third quarter (Q3) of 2018 versus 49 IPOs in Q3 2017, representing a significant drop of 61 per cent. With an ongoing volatility in equity markets along with the rising risk of trade-wars across different markets, it is becoming difficult for companies to raise equity capital, said Sandip Khetan, EY India. Khetan said companies that were looking to tap market in the near term should start proactively looking for alternative sources of capital as well. The report further cited a number of macro-economic factors which are contributing uncertainties such as, currency volatilities (depreciation of rupee), higher inflation in the US which may compel central banks to tighten monetary policies (increase in interest rates), resulting in withdrawal of investments from emerging markets, back to the US. Going forward, the IPO activity is expected to remain busy for the rest of the year, as there is a strong pipeline of Draft Red Herring Prospectus (DRHP) filed with the Securities and Exchange Board of India (SEBI). On the account of next year’s general elections, companies are expected to advance their IPOs in the last quarter of 2018, the report noted. Sectorwise, manufacturing sector (Metals & Mining and Chemicals) is the most active sector in terms of the number of IPOs, whereas financial sector is at the top in terms of issue proceeds, the report said.