Indian IPO Momentum Slows in 2025 as Companies Reassess Strategies
The Indian startup Initial Public Offering (IPO) momentum has slowed down in 2025, with only five IPOs materialising so far, a significant drop from the record-breaking 2024. Market analysts suggest that this pause could be a necessary correction, forcing companies to strengthen their financial models and pricing strategies.
The slowdown is attributed to several factors, including global volatility, foreign investor outflows, domestic regulatory adjustments, and the gap between private and public market expectations. Despite the slowdown, the pipeline of IPOs remains robust, with issues worth over ₹2.6 lakh crore lined up and about ₹1.2 lakh crore already cleared by SEBI.
Startups are currently hesitant about an IPO presentation due to market volatility, valuation uncertainties, regulatory complexities, and the risk of negative public scrutiny. Some startups are turning back to private equity as a stopgap, delaying IPOs without derailing growth. Analysts suggest that improved monsoon forecasts, GST rationalisation, and foreign capital inflows could bring fresh energy to the stock market today in the coming months.
The secondary market performance has led to investors becoming more selective and pushing for lower valuations. While the number of traditional companies filing Draft Red Herring Prospectuses (DRHPs) remains high, with over 85 in the first half of 2025, the number of mainboard IPOs hitting the stock market has decreased to about 24, down from 36 during the same period last year. The startup IPO momentum may be recalibrating for a healthier, more sustainable future.
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