Fundraising rises 20% despite fewer listings, while weak post-listing performance, cooling market activity and shifting investor trends signal caution beneath the surface.

IPO Boom Defies Market Gloom, But Investor Returns Disappoint

India's primary market continues to remain resilient despite volatility in the equity markets. According to the FY26 report by the National Stock Exchange of India (NSE), IPO fund mobilisation rose 20% year-on-year, even as the number of public issues declined to 219 in FY26 from 242 in FY25.

Total funds raised through IPOs (mainboard and SME) increased to Rs 1.78 lakh crore, indicating that companies continue to tap the markets successfully even amid subdued investor sentiment.

Beyond IPOs, broader capital-raising activity remained robust. Total fund mobilisation across equity and debt rose 9% to Rs 20.3 lakh crore in FY26, driven largely by debt issuances and rights offerings.

Post-Listing Performance Remains A Concern

While fundraising activity remains strong, returns tell a different story. Since 2020, nearly 396 IPOs have been launched, but 224 are currently trading below their issue price, highlighting weak post-listing performance for a majority of listings.

The trend is particularly visible among large issues. Data shows that all five of the biggest IPOs are currently trading below their issue price:

Hyundai Motor India: down over 9%

Life Insurance Corporation of India: down over 23%

One 97 Communications: down over 55%

Tata Capital: down around 6%

HDB Financial Services: down over 24%

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Investor Base Expands, But Composition Shifts

India's investor base continues to deepen, with Uttar Pradesh emerging as the top contributor to new investor additions, surpassing traditional leaders such as Maharashtra and Gujarat.

At the same time, younger participation has seen a marginal dip. The share of investors below 30 years declined to 38.4% from 39.5% last year, indicating a slight moderation in Gen Z participation.

Market Activity Cools Off

Trading activity has also softened over the past year. Active investors declined by around 5%, while derivatives activity saw a sharp drop. NSE data showed equity futures turnover fell nearly 15% year-on-year, signalling lower trading intensity and reduced risk appetite among investors.