Surfing the IPO wave in 2025

In 2025, India’s IPO (Initial Public Offering) market was described as a successful revival story. A wave of new issues ensued, many of them were oversubscribed multiple times, and new-age tech firms made their way to Dalal Street, and were listed on the stock exchanges. But beneath the surface of a busy primary market, the structure of these IPOs told a more complex story. Most of the massive amounts did not go into the coffers of the firms that raised them. It went to the existing shareholders, including promoters.

According to data compiled by Fortune India magazine, Indian firms and MNCs raised INR1.54 lakh crore through IPOs in 2025. Of this, INR97,000 crore, or almost two-thirds was through offer for sale, (OFS). The annual OFS share is the highest it ever had in the country’s IPO history. This implies that for the first time, exits by existing shareholders outweighed the money that accrued to the firms by a wide margin. The skew was particularly visible among new-age tech firms, including start-ups, some of which were loss-making ones.

The Pioneer newspaper analysed the data on Inc42’s IPO tracker, which showed that 18 startup-led firms listed on the exchanges across sectors such as fintech, SaaS, EVs (electric vehicles), D2C, and flexible workspaces. Together, they raised INR41,000 crore. More than half of that, or INR21,000 crore, came via OFS, with the remaining coming from the issuance of fresh equity. More than 50 per cent went into the pockets of the original investors. While the mix indicates the winners in the 2025 IPO cycle, this newspaper looked deeper into how these stocks behaved once they were listed.

Take Ather Energy, which was one of the most anticipated listings of the year. Its prospectus was anchored by a fresh issue of INR2,600 crore, alongside an OFS by existing shareholders. The structure reflected a combination of growth funding, and partial investors’ exit. It raised capital to fund expansion, while long-term backers partially monetised their holdings. Ather’s shares listed at a modest premium, and the trading in the weeks that followed it remained range-bound. However, from end-July 2025 onwards, when it had moved from INR300 to INR330, the stock took off. It reached a high of over INR750, before it settled down to just over Rs 600.

Pine Labs’ IPO leaned more heavily towards investor exits. Its IPO was dominated by an OFS of over INR1,400 crore, with a comparatively smaller fresh issue of INR472 crore. The stock listed with a 10 per cent gain. While the debut suggested comfort with supply, subsequent trading was more measured. In the past two months or so, it dipped from INR250 to INR215 (January 13, 2026), before it climbed to INR240 over the next few days of trading. The share price remains subdued, and below the listing price.

Urban Company, another widely tracked listing, was predominantly an OFS-led issue, with limited fresh capital, and opened more than 50 per cent above its offer price. It was among the strongest debuts of the year, which reflected strong demand and confidence in the brand and profitability narrative. From a high of over INR185 in late-September 2025, the stock moved downwards to less than INR130 now, or a loss of nearly a third. Earlier, on December 16, 2025, the price hovered around INR120. Clearly, interest has petered out.

At the other end of the spectrum were companies that leaned more heavily on fresh issuances of shares, rather than OFS. DevX, for instance, went to market primarily to raise new capital. Its shares were listed close to the issue price, and remained range-bound in the early trading on the first day. However, from INR64 on September 17, 2025, the stock steadily moved downwards to below INR38, or a loss of more than 40 per cent. The initial price was its highest, and the current one is the lowest ever over the past few months.

IndiQube Spaces’ listing was similar. From INR218 in July 2025, the current price is less than INR200, or a loss of 10 per cent. However, the stock gyrated wildly over the past few months, reaching a high of more than INR240 at one time. These listings illustrate a different risk. While fresh capital strengthens balance sheets, it does not automatically translate into secondary-market enthusiasm, particularly when growth paths remain uncertain.

Across the cohort, the listing-day performances varied sharply. Some high-OFS offerings delivered strong debuts, while others listed flat or slipped below issue prices. Lenskart Solutions, despite a large fresh issue combined with significant shareholder selling, listed below its issue price on one exchange and flat on another, highlighting that brand recognition and oversubscription did not insulate it from pricing discipline. But in December 2025, it jumped up by 10 per cent, and moved in a range-bound manner. There were doubts expressed by analysts about its financials.

The post-listing narratives are instructive. Several stocks that debuted strongly struggled to hold on to the gains in the weeks and months that followed, as supply from pre-IPO shareholders emerged, or the earnings scrutiny intensified. Others traded sideways for extended periods, effectively erasing the listing-day enthusiasm. The divergence suggested that while IPO structure influenced perception, it did not override fundamentals for long. Revenues, profits, future potential, and similar factors matter more to the investors, rather than who made most of the money through listings.

However, the focus on OFS, especially among the new-age start-ups indicates a desire among the existing shareholders, including promoters, angel investors, venture capitalists, and private equity players, to book profits after a wait of several years. This is a norm, rather than an exception, as early investors seek profitable exits to book returns. Hence, the shift in IPOs from raising fresh capital to fund firms’ growth to OFS may be questionable but not significant.

It does not automatically imply mispricing or opportunism. From an investor’s perspective, OFS changes the nature of risk. Buying into an IPO means helping someone’s exit, rather than funding a next phase.  The implications on stock prices are nuanced. A high OFS component can front-load supply of shares, and potentially reduce selling pressure later if the new shareholders believe in the firm. At the same time, it can signal that growth capital needs for a firm are limited, or that existing investors see better risk-adjusted returns elsewhere. Fresh-issue-heavy IPOs may promise growth, but leave the markets unconvinced if it does not materialise.