The Securities and Exchange Board of India (SEBI) has proposed major reforms to simplify IPO rules for India’s largest companies. These changes aim to make the Indian market more attractive for mega-unicorns and conglomerates, while also ensuring market stability and investor protection.
₹50,000 crore+ market cap companies: Minimum IPO dilution cut from 10% to 8%.
₹1 lakh crore+ companies: Dilution requirement reduced from 5–6% to 2.75%.
₹2 lakh crore+ mega-companies: Minimum dilution capped at 2.5%.
₹50,000 crore+ firms: Timeline for achieving 25% public float extended from 3 years to 5 years.
₹1 lakh crore+ companies: Extra flexibility if IPO float is under 15% at listing.
Phased dilution: Allowed to prevent sudden share oversupply in markets.
Market Stability: Avoids flooding the market with shares that could hurt valuations.
Boost to Domestic IPOs: Encourages large Indian unicorns (e.g., NSE, Reliance Jio) to list at home instead of abroad.
Investor Protection: Ensures fair balance between corporate fundraising and safeguarding retail investors.
For Companies: Eases pressure on large unlisted firms, making IPOs more viable.
For Markets: Supports smoother price action post-listing.
For Investors: Opens the door for blockbuster IPOs to stay in India.
“This recognizes the unique challenges of large-cap listings. The phased approach allows companies to raise capital without flooding the market.”
— Arka Mookerjee, Partner, JSA Advocates
Under the 2021 IPO rules, SEBI required:
5% minimum IPO size for ₹1 lakh crore+ firms.
25% public shareholding within 5 years of listing.
The latest discussion paper revises these norms and is open for **public comments until date.
Expect more big-ticket IPOs in Indian markets.
Reduced risk of post-listing price crashes due to controlled share supply.
Balanced framework that supports both corporate growth and market confidence.
Sources: SEBI Discussion Paper, Economic Times (Aug 2025), Industry Experts
