The frenzy around the initial public offering (IPO) market seems to have plateaued in 2025 amid a downturn in the domestic stock market and a decline in grey market prices of unlisted shares of IPO-bound companies. Moreover, the poor performance of recently-listed stocks has turned many companies away from going public via the IPO route.
As a result, many companies have postponed their IPO plans to the next quarter. Some are even considering lowering their valuations and the size of their offerings, as per several reports.
Several IPOs listed last year have yielded negative returns since their listing. Topping the list is Godavari Biorefineries with 57.97 per cent in negative, followed by Carraro India, which has corrected 55.73 per cent. Other IPOs like Western Carriers, Shree Tirupati Balajee Agro Trading Company, Tolins Tyres, and Suraksha Diagnostic have fallen between 40 per cent to 55 per cent.
Amid this slowdown in the IPO market, let’s take a look at alternative ways companies can get listed on the exchanges.
Alternative Ways For Companies To Go Public Other Than IPOs
1. Direct Public Offering Or Direct Listing Process
The most common alternative for companies to go public besides IPO is Direct Listing, or Direct Public Offering (DPO). In a DPO, companies can directly offer their shares to the public, thereby eliminating the need for financial intermediaries like investment banks, brokers or underwriters.
Bypassing financial intermediaries helps companies to considerably reduce the cost of raising capital.
In India, to list directly on the Bombay Stock Exchange (BSE), companies must already be listed on a nationwide exchange and meet certain criteria. These include having a minimum paid-up equity capital of Rs 10 crores, a net worth of over Rs 25 crores in the last three years, and at least 1,000 public shareholders. The company should also have a strong financial track record, no pending investor grievances, and no regulatory violations.
Similarly, there are certain eligibility criteria for companies to get listed on the National Stock Exchange (NSE).
In most cases, companies demerge from their already-listed parent company to debut via the direct listing route. According to Sebi's guidelines, a public limited company should have at least a 25 per cent stake in the unit it wants to demerge, to opt for direct listing. The most recent example is the listing of ITC Hotels, which is the hospitality arm of the ITC group.
ITC Hotels demerged with ITC Ltd in January and got listed on both the exchanges – NSE and BSE – on January 29, 2025.
Earlier in 2024, Raymond Lifestyle demerged from its parent company Raymond and made its debut on the exchanges. Jio Financial Services also followed this route, listing after demerging from Reliance Industries in 2013. Other companies such as Reliance Home Finance, Aditya Birla Capital, Jubilant Ingrevia, Adani Total Gas, Adani Green, and Adani Energy have also been listed through the demerger route.
2. Institutional Trading Platform (ITP)
India's start-up ecosystem has witnessed tremendous growth over the past decade; however, finding the right investors is still a challenge for many entrepreneurs. To address this issue, Sebi created the Institutional Trading Platform (ITP) in October 2013.
This allows small and medium enterprises (SMEs) to list their shares without having to go through the lengthy and complex process for IPO. It also gives Angel Investors and Venture Capitalists a safer and more transparent way to invest.
