Legal And Financial Analysis Of IPO Structures In India: Regulatory Safeguards And Market Realities
- IJLLR Journal
- Oct 25, 2025
- 2 min read
Milan Tyagi, O.P. Jindal Global University
1. Introduction
The Indian stock market is dynamic and serves as a key indicator of the nation's economic health and development. Initial public offerings (IPOs) significantly influence this market, shaping its overall landscape. With a robust regulatory framework, a strong domestic capital market, and a large base of retail investors, India is at the forefront of global IPO growth. An initial public offering (IPO) is an event where a company or firm raises its capital by the capital market in the first instance by offering shares to the general public. To reach a wider range of investors, it offers the chance to support the company's prospects for the future. A company initiates the public offering of shares when it wants to infuse fresh capital for its future operation like expansion, diversification, or modernization. Furthermore, the owner wants to enhance the value of the firm by issuing IPOs under favourable market conditions which otherwise is not possible through a straightforward sale. Therefore, the IPO event holds significant importance in a company's life cycle. However, when a private company or firm goes public, they needs to abide by the more regulatory amendments expeditiously and face new challenges, as it is the initial stage of any private company to go public. The economy of India is among the fastest-growing in worldwide, and investors from all over the world are taking notice. In an effort to draw international investors to the IPO market, the Indian regulatory body keeps updating its guidelines. To develop a thorough overview of the Indian IPO market, this research makes the following contributions to the existing knowledge. First and foremost is discussing more inclusively the eligibility criteria for IPOs and who can offer the IPOs that have been vested under the SEBI (Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations 2018 [Last amended on March 8, 2025]). Secondly, about the legal and financial analysis of IPO structure in India, in which we observe that IPO performance measures such as IPO underpricing, post-listing volatility, IPO grading and the impact of corporate governance on IPO performance are key areas of literature with very famous and known IPOs of India i.e., Zomato and JSW. Issue of shares to public is the most common and popular method of raising funds by the company for the purpose of raising funds for diversification, modernisation and expansion of the company. Public issue of shares is governed by the provisions of the Companies Act, 2013, the Securities Contracts (Regulation) Act, 1956, the Securities Exchange Board of India Act, 1992, the SEBI (Disclosure and Investor Protection) Guidelines, 2000, the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009, the Companies (Prospectus and Allotment of Securities) Rules, 2014, the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the listing requirements of a stock exchange.
