Can India’s IPO boom turn into durable gains

India’s IPO pipeline is swelling because liquidity is strong, earnings are resilient and investor appetite is high, and both mainboard and SME issues have raised record sums this year with heavy over subscriptions and solid listing gains in many cases. SEBI’s own updates and circulars show tighter disclosure and reporting across offer documents to keep pace with this growth and protect investors. Analysts now warn that the cycle enters a phase where governance, proceeds tracking and post-listing discipline will decide long-run outcomes for investors and markets.

So the focus shifts to how companies use the money and who checks it, because misuse shows up in SME IPOs through related-party transactions, circular trades and vague “general corporate purposes” buckets that mask diversion risks. Recent enforcement orders detail siphoning of proceeds and manipulative schemes, including cases where a majority of funds were allegedly routed to connected entities, prompting debarments and refunds. These actions underline why clear capex plans, milestone-linked spends and timely disclosures are vital once shares list and hype fades.

What can improve outcomes now? SEBI’s amendments strengthen pre-issue and ongoing disclosures, require faster reporting of promoter transactions and expand monitoring in larger issues via registered agencies, while proposing stricter norms for SME proceeds oversight. Regulators examine merchant bankers’ conduct, related-party deals, and pre-IPO placements to stop fund leakage and conflicts of interest. Investors read utilisation sections, track quarterly updates and board audit notes, because strong monitoring and clean governance keep capital productive and returns steady in a busy primary market.