India retained its position as the world's largest market for initial public offerings (IPOs) by number of issues during FY2025-26 while ranking third globally in terms of capital raised, according to the Securities and Exchange Board of India (SEBI) Annual Report 2025-26. The report highlights the sustained strength of India's primary equity market despite a challenging global environment marked by geopolitical conflicts, trade tensions, volatile capital flows and rapid technological disruptions.
IPO market maintains momentum
In his message accompanying the annual report, SEBI Chairman Tuhin Kanta Pandey said India's primary equity market continued to demonstrate strong momentum throughout the financial year. "The primary equity market demonstrated continued dynamism, with India ranking first globally in the number of IPOs and third in terms of funds raised," Pandey said. The regulator attributed the performance to sustained investor participation and continued access to public capital by Indian companies despite global market volatility.
Reforms to simplify fundraising
To support capital formation while protecting investors, SEBI introduced several regulatory changes during the year. Among the key reforms was the restructuring of the minimum public offer framework, linking public shareholding requirements to the size of an issue. The regulator also extended the deadline for the country's largest listed companies to achieve the mandatory 25 per cent minimum public shareholding from the existing timeline to 10 years, giving large enterprises greater flexibility after listing. According to SEBI, the move is intended to facilitate access to capital markets while reducing the need for repeated equity dilution.
Relief for startup founders
In another significant reform, SEBI allowed founders of new-age technology companies to retain Employee Stock Option Plans (ESOPs) granted before an IPO. The regulator said the measure would help preserve long-term incentives for founders while ensuring adequate disclosures and transparency for public investors. The change is expected to make public listings more attractive for startup founders transitioning to listed companies.
Capital markets show resilience
Pandey said India's financial markets remained resilient during one of the most challenging periods in recent years. He noted that SEBI's regulatory strategy has increasingly focused on building "resilience by design" by strengthening market integrity through technology-driven supervision, including greater use of artificial intelligence, while simultaneously simplifying compliance requirements for market participants.
Supporting India's growth ambitions
The report says India will require significantly larger pools of capital to finance its long-term development priorities, including infrastructure expansion, manufacturing growth and the energy transition. SEBI noted that these investment requirements cannot be met solely through the banking system and emphasised the need for deeper capital markets. Accordingly, the regulator said its policy focus during FY26 remained centred on strengthening the equity market, corporate bond market and alternative investment ecosystem so that they can complement traditional financing channels and support India's ambition of becoming a developed economy by 2047.