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Wealth created through SME IPOs in India

IPO is one of the great ways to build long term wealth. However, it is important to analyse the company well before investing. This is because not all IPOs may succeed. Thus, one should do self-study to pick the best IPOs with great potential.

The below data depicts the amount of wealth created by the SME IPOs overtime. It shows the number of SME IPOs issued in a year and compares the market capitalisation (cap) of these SME IPOs at the time of issue with the current market cap. The difference between these two market caps represents the wealth created for investors from the issue date till now.

Thus, one should assess one's financial goal whether one wants to make quick profits on listing and take an exit or take risk and stay invested to generate wealth.

Investor wealth created from SME IPOs

Year Number of IPOs Amount Raised (Rs Cr) IPOs with Positive Listing Total Market Cap (IPO) (Rs Cr) Market Cap w.r.t. Listing Day Close Price (Rs Cr) Current Market Cap (Rs Cr) Wealth Created (Rs Cr) Listing Day Gain (%) Wealth creation w.r.t. listing day close price (%) Wealth Created (%) SME Migrated to Mainboard
2024 * 2258,32820430,32248,79356,52426,20260.92%15.84%86.41%0
2023 1794,82214916,93423,42849,67232,73838.35%112.02%193.33%0
2022 1081,942896,7748,80527,39420,62029.99%211.12%304.42%1
2021 55767402,6192,90811,2418,62211.03%286.55%329.19%5
2020 30182236466432,8262,180-0.45%339.51%337.52%16
2019 47580412,1382,2058,8096,6713.12%299.54%311.99%24
2018 1412,3651068,4798,78721,51013,0313.63%144.80%153.69%93
2017 1261,7081026,2866,97823,23216,94611.01%232.92%269.56%78
2016 64521501,9371,9628,3026,3641.27%323.14%328.52%39
2015 40258348689183,6762,8085.77%300.57%323.69%21
2014 39293299239955,2674,3447.77%429.47%470.64%24
2013 25264197549011,58983419.43%76.39%110.66%14
2012 12115123235151,8191,49659.28%253.35%462.83%8

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Note: Three prices are taken into account in this report:

  1. Issue price final (price at which the SME IPO shares are sold)
  2. Listing day close price (price at the end of the day on which the SME IPO shares are listed)
  3. Current Market Price (current market price of the share)

The wealth creation is derived using below formula:

  • 2-1 = Listing Day Gain
  • 3-2 = Wealth creation w.r.t. Listing Day Close Price
  • 3-1 = Wealth Created

The information presented in this report is based on historical data from SME IPOs and includes the following key figures, with specific conditions to ensure accuracy:

  • Number of IPOs: Represents the total number of IPOs carried out in a given year. This figure includes all IPOs that were open during the specified year.
  • Amount Raised (Rs): The sum of the issue size for all IPOs, reflecting the total capital raised in that year. Note: This figure excludes IPOs that were withdrawn or canceled, and FPOs.

    Amount Raised (Rs) = Sum (Issue Size)

  • IPOs with Positive Listing: Represents the total number of IPOs listed with profits according to the closing price on the day of the IPO listing.
  • Total Market Cap (IPO) (Rs Cr): Represents the total post-issue market cap of the issuing companies in a given year. The market cap does not take into account the effects of corporate action events such as bonuses, rights, buybacks, share splits, etc.

    Total Market Cap (IPO) (Rs Cr) = Sum (Post-issue Shareholding * Issue Price Final)

  • Market Cap w.r.t. Listing Day Close Price (Rs Cr): Represents the total market cap of the issuing companies in relation to the listing day close price in a given year. Most people do not get allotment in IPOs with high demand. However, they can buy shares on the market on the day of listing. This parameter is the basis for calculating wealth creation when shares are bought from open market on the day of listing.

    Market Cap w.r.t. Listing Day Close Price (Rs Cr) = Sum (Post-issue Shareholding * Listing Price Close Price)

  • Current Market Cap (Rs Cr): Represents the total market cap of the issuing companies in a given year in relation to the current market price. Note: The market cap does not take into account the effects of corporate action events such as bonuses, rights, buybacks, share splits, etc.

    Current Market Cap (Rs Cr) = Sum (Post-issue Shareholding * Current Price)

  • Wealth Created (Rs Cr): This value reflects the difference between the current market cap of all IPOs and the total market capitalization at the time of the IPO in a given year.

    Wealth Created (Rs Cr) = Sum (Current Market Cap (Rs Cr) - Amount Raised (Rs))

  • Listing Day Gain (%): This value reflects the percentage profit on the day of listing in relation to the final issue price. For example, if the final price of an IPO share is Rs 100 and the listing day close price is Rs 140, the profit on the listing day gain is 40%.

    Listing Day Gain (%) = Average ((Market Cap w.r.t. Listing Day Close Price - Total Market Cap (IPO) / Total Market Cap (IPO)) * 100)

  • Wealth creation w.r.t. Listing Day Close Price (%):Represents the percentage of total wealth created by the IPOs in India compared to the IPO shares bought in the open market on the day of listing. For example, if an investor bought the shares at a price of Rs 140 on the open market on the listing date and the current share price is Rs 420, the wealth creation w.r.t. listing day close price is 200%.

    Wealth creation w.r.t. Listing Day Close Price (%) = Average ((Current Market Cap - Market Cap w.r.t. Listing Day Close Price / Market Cap w.r.t. Listing Day Close Price) * 100)

  • Wealth Created (%): Represents the percentage of total wealth created by the IPOs in India compared to the investments made in IPOs.

    Wealth Created (%) = Average ((Current Market Cap - Total Market Cap (IPO) / Total Market Cap (IPO)) * 100)

  • Companies Migrated to Mainboard: Refers to the number of companies that were listed on the stock exchange in a given year and later moved from the SME platform to the main stock exchange.

Additional IPO Performance Reports