THE IPO ASCENT

The IPO market strides into 2025 - undaunted by global jitters, powered by domestic strength and digital momentum

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India’s IPO market has entered 2025 with strong momentum, showing resilience even as global uncertainties - including rising US protectionism - cast a shadow on capital flows.

While the US has reintroduced broad tariffs, particularly on Chinese imports, and tightened trade exemptions, India’s capital markets are demonstrating a new level of maturity and strength.

Backed by domestic strength, sectoral diversity, and a strong investor base, the Indian capital market seems well-positioned to absorb shocks and move forward.

At the heart of current concerns is the recent shift in US trade policy. In early 2025, the US government announced sweeping tariff changes, reviving a more protectionist stance. This included a new 10% baseline tariff on all imports and a dramatic hike in cumulative tariffs on Chinese goods - rising to 125% in some categories, especially targeting key sectors like EV batteries, solar panels, and semiconductors.

In addition to this, the US removed the “de minimis” exemption, which had allowed goods valued under $800 to enter duty-free. The new rules mean platforms like Shein and Temu, popular for low-cost consumer goods, are now subject to duties as high as 90%, reshaping global supply chains.

While these moves are largely aimed at decoupling from China and boosting American manufacturing, the ripple effects are global.

Capital tends to retreat to safer assets during times of trade uncertainty.

For emerging markets like India, that can mean volatility, as foreign institutional investors (FIIs) become more cautious. But this time, the story is more nuanced.