India’s IPO market is witnessing a slowdown in 2025 as investor sentiment weakens due to market volatility and global economic concerns.
A significant portion of newly listed stocks are trading below their issue prices, reflecting cautious investor participation and lower-than-expected demand.
The primary market, which had outperformed the secondary market in previous years, is struggling to sustain its momentum.
Retail investor enthusiasm has notably declined, leading companies to reconsider their IPO plans.
Many firms are delaying or downsizing their public offerings amid fears of poor listing performance and subdued market response.
Over 65 pc of 2025 IPOs Trading Below Issue Prices
According to data from Trendlyne, 55 companies have completed their IPO listings in 2025, but 37 of them—accounting for nearly 67%—are currently trading below their issue prices.
This underperformance highlights the impact of market volatility on newly listed firms.
Among the worst-hit stocks, GB Logistics Commerce is trading at a steep 61 pc discount to its IPO price, making it the weakest performer so far.
Davin Sons Retail and Citichem India have also seen significant declines, each trading 50 pc below their respective issue prices.
Several other stocks, including Ken Enterprises, Delta Autocorp, and Malpani Pipes and Fittings, have dropped between 20% and 54% from their IPO valuations.
The segment-wise performance reveals a broader trend of underperformance. Six out of 11 main board IPOs and 31 out of 44 SME IPOs are currently trading below their listing prices, suggesting that both large and small firms are struggling to attract sustained investor interest.
March Listings Face Weak Demand
The impact of weak investor sentiment is particularly evident in IPOs launched in March 2025. Out of five newly listed companies, three debuted below their issue prices, reflecting lower subscription rates.
These IPOs were only subscribed between 1 to 5 times, with retail investors showing little enthusiasm compared to last year, when SME issues were often subscribed hundreds or even thousands of times.
This marks a sharp contrast to the IPO frenzy seen in 2024, where several SME IPOs saw record-high retail participation, with some being oversubscribed by up to 2,000 times.
Market Volatility and Regulatory Scrutiny Impacting IPOs
Analysts at Bajaj Broking believe that the slowdown in India’s IPO market in 2025 is due to a mix of market volatility, liquidity constraints, and regulatory changes.
Rising global geopolitical tensions and fluctuating interest rates have led to cautious investor sentiment, reducing risk appetite.
Additionally, higher bond yields and tighter monetary policies have impacted liquidity, making it difficult for companies to attract substantial investments.
SEBI’s stricter regulations on IPO disclosures and pricing have also influenced listing plans, with many firms opting to delay their public offerings until conditions improve.
Saturation Effect from 2024 IPO Boom
Another reason for the cautious approach in 2025 is the heavy influx of IPOs in 2024, which led to a saturation effect.
Many investors, having already deployed capital in the previous year’s offerings, are now being more selective in their investment decisions.
Bajaj Broking suggests that if market conditions stabilise and interest rates soften, IPO activity could see a rebound in the second half of 2025.
However, for now, companies remain hesitant to go public amid concerns over valuations and investor demand.
Companies Await Improved Market Conditions
Despite securing SEBI approvals, several companies have decided to pause or delay their IPOs due to unfavourable market conditions.
Uncertainty in the global economy, sector-specific challenges, and fluctuating interest rates have made firms wary of launching IPOs at this time.
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