New Delhi, May 2 -- Turbulence in public markets has muddied another fundraising avenue for unlisted companies: Pre-IPO share sales.

Wealthy individuals and institutions often snap up shares in private deals, tempted by potentially high returns in future initial public offerings (IPO). However, choppy markets have clouded many IPO plans, sparking caution at the pre-IPO stage as well. According to bankers and lawyers working on pre-IPO deals, investors who crowded such rounds earlier now want to bullet-proof their investments.

"Investors are increasingly asking for readjusted and discounted valuations, more controlling rights or stake, and negotiating on deal closing timelines to mitigate risks associated with the current market conditio...