India’s primary market (IPO) in 2025 has sent a clear message, bigger is better, at least for investors looking for meaningful listing gains and sustained post‑listing performance. Of the 103 IPOs in 2025 that came to the market for fundraising, there was a striking divergence between large‑cap issuances of Rs 3,000 crore and above and the long tail of smaller public offers.
In 2025, 17 companies that floated IPOs with an issue size above Rs 3,000 crore had an average listing gain of 19%, while the current price gains versus IPO price average 18%. In contrast, the smaller‑sized IPOs—Rs 3,000 crore and below—delivered only 9% on both listing day and current price metrics.
“Large sized IPOs tend to come from companies with established business models, predictable cash flows and strong governance frameworks. These attributes naturally attract long‑term institutional capital, which in turn supports healthier price discovery and more stable post‑listing performance,” said a CEO of a domestic investment bank.
Institutional Magnet: Why Scale Commands Premium Valuations
V Jayasankar, MD and member on the board, Kotak Investment Banking, added, “In our experience, mid‑cap and large‑cap IPOs with mature business models create far better outcomes for investors. These companies offer stability, scale and clarity of earnings, which support disciplined pricing and healthier post‑listing performance. The data speaks for itself—quality issues have outperformed by a wide margin.”
Scale brings both credibility and confidence. Of the 17 large IPOs, only 3 recorded negative returns on listing, compared to 21 of the 86 small-sized IPOs. The data clearly shows that IPOs of Rs 3,000 crore and above have rewarded investors meaningfully more than smaller issues.
The data highlights a widening performance gap that is reshaping investor behaviour and institutional allocation patterns. Market participants attribute this trend to a combination of stronger fundamentals, higher governance standards, and deeper institutional participation in large‑ticket offerings. These issuances—ranging from Tata Capital and HDB Financial Services to LG Electronics India and ICICI Prudential AMC—have demonstrated resilience not just on debut but also in the weeks following listing, signalling sustained investor confidence.
Governance Premium: Resisting Secondary Market Volatility
“If you really want to understand demand, look at the monthly traded value. It cuts through the noise of day trading and shows you where long‑term capital is flowing. That’s also how we evaluate IPOs,” Jayasankar added.
The contrast is stark. While mega‑issues such as LG Electronics (50% gain on listing), Meesho (45%), Physicswalla (31%) and Tenneco Clean Air (25.4%) have delivered double‑digit to high double‑digit returns, a significant portion of sub‑Rs 3,000 crore IPOs have struggled to hold their ground, with several trading below the issue price. Meanwhile, 45 of the 86 small-sized IPOs are trading below their IPO price, with some falling as much as 53%. Companies like Glottis (53.3% down from IPO price), Jaro (51%), Gem Aromatics (49%) and VMS TMT (46%) have eroded investors’ wealth.
Not every small-sized IPO has been bad. “Size may influence fees, but it doesn’t determine quality. We look at the sector, the industry’s scale, and whether the business has reached robustness and stability,” said Jayasankar, citing that a Rs 1,900 crore IPO like Urban Company can be far superior to a Rs 2,500 crore one if the underlying model is stronger. Urban Company is among the modest-sized IPOs that recorded 56% listing gains and is currently trading 33% above the IPO price.
As India’s IPO pipeline continues to deepen, the trend suggests that investors—both retail and institutional—are increasingly gravitating toward size, stability and scale. And for now, the market seems to be decisively rewarding that instinct.