IPO Market Overview (India)
India's primary market has seen remarkable growth in IPO activity, with record years in 2021 and 2023-24 driven by new-age tech companies, consumer brands, and SMEs listing on BSE SME and NSE Emerge — with retail investor participation surging alongside ASBA, UPI-based applications, and digital brokers.
The Initial Public Offering (IPO) market is the gateway through which companies access public capital and investors gain entry into early-stage ownership of growing businesses. India's IPO market has matured considerably, with SEBI continuously refining the process to improve efficiency and investor protection.
HISTORICAL MILESTONES: The post-liberalisation boom of the 1990s saw numerous IPOs, many of which collapsed due to poor regulation. SEBI's introduction of book-building (1999), ASBA (2008), and mandatory QIB allocation transformed the market's integrity. The 2021 vintage — with Zomato, Paytm, Nykaa, PolicyBazaar — marked the arrival of Indian new-age internet companies on public markets.
RECORD YEARS: FY2022 saw ₹1.1 lakh crore raised across 53 mainboard IPOs. FY2024 surpassed this, with the LIC IPO at ₹21,000 crore remaining the single largest. The SME IPO segment has also exploded — BSE SME and NSE Emerge together list hundreds of small companies annually.
REGULATORY FRAMEWORK: SEBI mandates detailed DRHP (Draft Red Herring Prospectus) disclosure, cooling-off periods, price band discovery through book-building, anchor investor allocation, and a mandatory listing within 6 days of allotment. QIBs, NIIs (non-institutional investors), and retail investors receive reserved portions.
ASBA AND UPI: The ASBA (Application Supported by Blocked Amount) mechanism, enhanced with UPI as a payment channel, has made IPO applications seamless for retail investors. Funds are blocked (not debited) during the application period and released if not allotted — eliminating working capital loss.
GREY MARKET: An informal pre-listing market exists (the grey market or GMP — Grey Market Premium) where IPO allottees trade their yet-to-list shares. While not regulated, it provides a crude signal of listing sentiment.
The Indian IPO market reflects the country's entrepreneurial dynamism. As more Indian founders seek public market exits and global PE/VC investors monetise positions, IPO supply is likely to remain robust through the decade.