Mumbai: India is increasingly seeing private equity and venture capital backed companies tap public markets at an earlier stage in their lifecycle, driven by factors such as greater predictability in business performance, liquidity needs, and conducive regulatory policies, making IPOs an attractive option.
“Over the past few years, public markets have also become more willing to underwrite newer business models. That increases confidence for sponsors to view IPOs (initial public offerings) as a viable, attractive exit option earlier in the company lifecycle,” Gaurav Sood, managing director and head of equity capital markets of Avendus Capital. With institutional sponsors on the cap table, he explained that companies typically adopt public-market discipline earlier, including tighter audits, stronger governance standards and sharper key performance indicator (KPI) frameworks.
In the latest report, venture capital firm Blume Ventures highlighted that the median age for private equity and venture capital players going public touched a decade-low of 12 years in 2025 from 17 years, a year earlier and 8 years in 2015. In comparison, promoter-backed entities last year had a median age of 18 years to go public from 22 years in 2024, the data showed. Some of the PE-VC backed companies that went public last year within this timeframe include Groww, Physicswallah, Smartworks Meesho, The Leela Palaces, Ather Energy, We Work India, and Indiqube.
“We have a dozen full of companies in our portfolio which will go IPO in the next 36 months. We have been big proponents of companies with predictable and profitable P&L going public without waiting for a billion-dollar valuation milestone,” Blume’s Vikram Gawande said. “As founders raise institutional capital, they need to keep in mind that they need to honour the liquidity requirements of these investors in future.”
Shrinking timelines
Avendus’ Sood further noted that regulatory and process timelines may compress further. “The confidential filing route allows issuers to engage SEBI early, while controlling public exposure until they are ready. This enhances flexibility and encourages more companies to enter the IPO funnel sooner,” he said, adding that SEBI’s focus on faster approvals and proposals to reduce friction points can further reduce procedural lead times.
While business maturity timelines operate differently, “the market is clearly seeing more venture-backed companies reach IPO readiness sooner, with several now approaching listing within ~5 years of institutional funding, versus earlier generations that often took closer to a decade to build scale,” Sood said.
Broadly, IPOs provide initial liquidity to the issuer and shareholders, allowing for a gradual exit over the medium term. “Listing is a natural progression for companies that have raised private investments from either VC or PE investors, especially as they are already familiar with aspects of disclosure and governance given the presence of third parties,” said Samarth Jagnani, Morgan Stanley’s head of global capital markets of India & Southeast Asia.
With several examples of successful exits for private equity firms over the past five years, he added that the cycles of macroeconomic growth and stability has boosted business performance of corporate entities, further driving the momentum in the markets aided by liquidity and financialization of savings.
His comments come after Indian IPO markets hit a fresh high in 2025 with 103 companies raising ₹1.76 trillion, driven by several new-age listings and large issuances from companies such as Tata Capital, HDB Financial Services, LG Electronics, Wakefit, Pine Labs, Bluestone, Lenskart and Groww, among others.
Strong mass support
The markets were supported by sustained domestic institutional flows with mutual funds and insurers continuing to deploy capital at elevated levels, providing an anchor bid for quality issuers. “SIP-led household participation and stronger DII depth are creating a larger, more consistent pool of capital, enabling companies to access public markets earlier,” Sood added. “For higher-quality businesses, FIIs (foreign institutional investors) are increasingly participating in primary markets to build positions early, strengthening anchor books and boosting issuer confidence.”
As a result, IPOs have become a practical route for companies to raise meaningful primary capital. The regulators have also actively worked to compress IPO approval timelines, with many now concluding in about 3 months versus the earlier ~6-month norm, Sood said.
While listing earlier in the journey has lesser proof of investors underwriting the company, such entities need to place greater importance on governance standards, disclosure quality and narrative credibility when approaching the public markets.
For loss-making companies, investors continue to expect a dependable, well-articulated path to profitability. While market tolerance for misses can be materially lower for early-stage issuers, these companies must “invest in compliance processes, internal controls and transparent board practices well ahead of the IPO to ensure that post-listing execution is not disrupted,” Sood concluded.