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The Good, Bad, and Ugly of India's Pre-IPO Investing
Mint Chennai
|June 30, 2025
Investing in the pre-IPO market is risky, as poor entry valuation, exit timing can lead to losses
Until recently, you couldn't track it on your trading app. No real-time charts, no market-wide consensus. Yet, the stock was quietly doubling in value. We're talking about National Stock Exchange's (NSE) pre-IPO shares—the crown jewel of India's booming pre-IPO segment. The recent surge in NSE's price has reignited interest in India's fast-evolving alternate investment space. But that's just the surface. Beneath lies a deeper, complex, and risky world of pre-IPO investing.
The Good: Over the past three years, India has seen over 200 mainboard IPOs and over 530 SME IPOs in India. In anticipation of listing-day gains, a majority of IPOs saw significant oversubscription from retail investors. With allotment chances dipping, some retail investors turned to the pre-IPO segment to get in early and chase post-listing wealth. These shares typically carry a six-month lock-in from listing. Historically, the strategy has paid off, with marquee names, like the BSE and Avenue Supermarts, delivering stellar returns.
This story is from the June 30, 2025 edition of Mint Chennai.
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