Why in the news
Market volatility and cautious sentiment slowed mainboard IPOs, yet SME IPOs stayed strong as investors leaned toward smaller high-growth firms.
Yearly SME IPO data
| Year | Funds raised (₹ crore) | Issues |
|---|
| 2024 | 8,761 | 240 |
| 2023 | 4,686 | 182 |
| 2022 | 1,875 | 109 |
| 2021 | 746 | 59 |
| 2020 | 159 | 27 |
| 2019 | 624 | 51 |
| 2018 | 2,287 | 141 |
SME versus mainboard by month
| Month | Mainboard: issues | Mainboard: ₹ crore | SME: issues | SME: ₹ crore |
|---|
| March (to 11th) | 0 | 0 | 6 | 170 |
| February | 3 | 10,878 | 20 | 930 |
| January | 6 | 4,845 | 20 | 880 |
Why SME IPOs are gaining
- Appetite for growth: retail investors, notably in Tier 2 and Tier 3 cities, are joining.
- Easier entry: SME listing rules are lighter; SEBI curbs on OFS and profitability requirements improve transparency.
- Listing gains: many issues gave strong post-listing returns, despite lower liquidity.
- Mainboard caution: big firms delay plans over volatility, higher interest rates and valuations.
Outlook
- Mainboard issues may revive if markets stabilise.
- Growing retail participation could widen the investor base.
Exam angle
- SEBI is the regulator of IPOs.
- OFS = Offer-for-Sale.