Mumbai, Oct. 23 -- The SME IPO market in India saw a sharp surge in activity during FY 2023-24 and FY 2024-25, supported by strong retail participation, and favourable market sentiment, the RBI said in a study released in its October Bulletin. During most of this time, SME IPOs recorded high oversubscription levels and listing gains.

Macroeconomic and policy factors like overall market buoyancy, and advancement in payment and settlement mechanism in the IPO market drove this boom.

Most IPO proceeds were used for capital enhancement or working capital purpose by the SMEs. Despite robust listing gain, post-listing performances of these SME stocks reveal both opportunities and risks for the investors.

SME IPOs may offer impressive gains i...