SME IPO: Process, Lot Size & Risks

What Is an SME IPO and How Is It Different from a Mainboard IPO?

An SME IPO is an initial public offering made by a small or medium-sized enterprise that lists on one of India's two dedicated SME exchange platforms - BSE SME or NSE Emerge - rather than on the main boards of BSE and NSE. The distinction matters a great deal, because the regulatory requirements, listing criteria, investor eligibility rules, and trading mechanics are significantly different between the two segments.

On the mainboard, companies must comply with the full suite of SEBI's Issue of Capital and Disclosure Requirements (ICDR) Regulations. Minimum post-issue paid-up capital requirements are higher, the track record requirements are more stringent, and the disclosures are more detailed and frequent. Mainboard IPOs can attract qualified institutional buyers (QIBs), non-institutional investors (NIIs), and retail individual investors (RIIs) under a well-defined reservation structure.

For SME IPOs, SEBI has created a separate, lighter-touch framework. Under the SEBI (ICDR) Regulations (and the specific chapters that pertain to SME issuers), the eligibility criteria are calibrated downward. For instance, the minimum post-issue paid-up capital for an SME IPO is generally lower than the mainboard threshold, and the post-issue capital must not exceed a specified ceiling - once a listed SME company crosses that ceiling through subsequent capital raising, it is expected to migrate to the mainboard.

One of the most important differences is that SME IPOs do not require underwriting by a merchant banker in the same way as mainboard issues, but the issue must be 100% underwritten. In practice, the book-running lead manager (BRLM) to the issue often underwrites the entire amount, which provides a degree of assurance that the issue will not fail due to under-subscription, but it also means the BRLM has significant skin in the game and may influence pricing.

Another major difference is the reservation of shares. In a mainboard IPO, a portion is reserved for retail investors, another for high-net-worth individuals (HNIs), and another for QIBs. In an SME IPO, there is no separate retail individual investor quota in the traditional sense. Instead, shares are offered to two categories: QIBs and non-institutional investors (NIIs, which includes retail applicants at SME lot sizes). At least 50% of the issue must be allotted to QIBs, and the remaining 50% goes to other investors including retail applicants.

Perhaps the most tangible difference for a retail investor is the minimum application or lot size, which we will examine in detail in a dedicated section. The lot sizes in SME IPOs are substantially larger in monetary terms, which naturally limits participation to investors who can commit a meaningful sum of capital at once.

Finally, post-listing, the trading in SME stocks operates under different circuit filter and market-making rules. A market maker is mandatory for SME listed stocks, providing two-way quotes to ensure some minimum liquidity - a safeguard that does not exist for mainboard listed stocks in the same way. Despite this, liquidity in SME stocks can be thin, and exit opportunities may be limited in practice.

The Regulatory Framework: SEBI, BSE SME, and NSE Emerge

The regulatory architecture for SME IPOs in India flows from SEBI at the top, with the two exchanges - BSE and NSE - operating their SME platforms under SEBI-approved frameworks and their own listing rules.

SEBI introduced the SME listing framework primarily to channelise formal equity capital toward small businesses that had previously been locked out of the public markets. The regulatory philosophy is one of proportionality: the compliance burden is reduced relative to mainboard listings, but the protection of investor interests remains paramount. SEBI has progressively refined this framework over the years, tightening disclosure norms, adding requirements around minimum promoter contribution and lock-in periods, and strengthening post-listing compliance expectations.

The key eligibility criteria that a company must typically meet to file an SME IPO (these are subject to change and investors should always verify with the latest SEBI regulations):

The company must have a track record of at least three years in operations, or the promoters and management must have a combined experience that satisfies the exchange's criteria. Net tangible assets, net worth, and distributable profits criteria are prescribed, though they are calibrated much lower than mainboard requirements. The post-issue paid-up equity capital must generally be below the threshold that would require a mainboard listing, which ensures that companies on the SME platform remain genuinely small in scale.

BSE SME and NSE Emerge each operate under a listing agreement that imposes ongoing disclosure obligations on listed companies. These include quarterly financial results, annual reports, disclosures on material developments, and shareholding patterns. While the format and frequency of disclosures are somewhat lighter than the mainboard, a listed SME company is still bound by SEBI's Listing Obligations and Disclosure Requirements (LODR) Regulations, adapted for the SME context.

SEBI also regulates the merchant bankers (also called book-running lead managers or BRLMs) who manage SME IPOs. A SEBI-registered Category I merchant banker must be appointed. The merchant banker is responsible for conducting due diligence, preparing the prospectus, coordinating with the exchange and registrar, and often underwriting the issue. Given that merchant bankers earn fees from successful issues, investors should bear in mind that their incentives are not perfectly aligned with those of the investing public - this is not unique to SME IPOs, but it is worth remembering.

SEBI has, over time, also introduced measures to curb misuse of the SME IPO route - for instance, tightening rules around the use of IPO proceeds, requiring more specific fund utilisation disclosures, and increasing scrutiny on related-party transactions. Investors who notice vague fund utilisation plans (such as a high proportion of proceeds allocated to "general corporate purposes" without specifics) should treat that as a yellow flag.

From the exchange side, both BSE SME and NSE Emerge have dedicated listing teams, helpdesks, and market-making frameworks. The market maker appointed for each SME stock is obligated to provide buy and sell quotes continuously during trading hours, helping ensure that investors can transact. However, the depth and reliability of this liquidity should not be overestimated.

Who Can List on the SME Platform? Eligibility Criteria Explained

Understanding the eligibility criteria for an SME IPO is important for investors because it gives you a sense of the typical company that uses this route. Unlike mainboard IPOs where the issuing companies are often well-established with long track records, significant revenues, and analyst coverage, SME IPO companies are, by definition, smaller and often earlier in their public-market lifecycle.

SEBI and the exchanges have prescribed eligibility norms that issuers must meet. While the specific numbers can change with regulatory updates and readers should always verify the latest SEBI ICDR Regulations, the following principles generally apply:

Post-issue paid-up capital: The total equity capital after the IPO must fall within a prescribed range - typically not exceeding a ceiling that would qualify the company for the mainboard. Once a company's paid-up capital through subsequent fundraising exceeds this ceiling, migration to the mainboard is triggered.

Track record: The company (or its promoters) must demonstrate a minimum operational history. Companies that are very newly incorporated generally cannot use this route without meeting alternative criteria around promoter experience.

Net worth and tangible assets: Minimum thresholds apply. The company should not have negative net worth, and there are norms around distributable profits (or permissible exceptions to the profit requirement based on alternative criteria).

No winding-up or regulatory action: The company must not be under any insolvency proceedings, and there must be no adverse regulatory orders against the company or its key promoters within a defined look-back period.

Demat form: All shares must be in dematerialised form before the IPO.

It is equally important to understand what these criteria do NOT guarantee. Meeting eligibility criteria means a company is legally permitted to list - it does not mean the business is fundamentally sound, the promoters are of high integrity, the valuation is reasonable, or the post-listing performance will be positive. Many promoters use the SME IPO route for legitimate growth capital needs, but some have used it to create artificial demand and then exit at inflated prices - a phenomenon the market calls a pump-and-dump. SEBI has been actively working to address such misuse, but investor vigilance remains the most important safeguard.

For investors, the eligibility criteria serve as a starting, not an ending, point for due diligence. A company that barely meets the minimum criteria - thin profits, just three years of operations, limited tangible assets - is a very different proposition from one that comfortably exceeds all thresholds. Reading the company's financial statements in the prospectus is not optional; it is essential.

The SME IPO Process: From Filing to Listing

The journey of an SME IPO from conception to the day shares begin trading on the exchange involves several structured steps. Understanding this process helps investors know what documents to look for, what each stage means, and where due diligence opportunities exist.

Step 1 - Appointing Advisers: The company's board decides to go public and appoints a SEBI-registered merchant banker (BRLM), a registrar to the issue (who will manage applications and allotments), legal advisers, and statutory auditors if not already in place. The merchant banker conducts initial due diligence - reviewing financials, business model, legal standing, and regulatory compliance.

Step 2 - Preparing the Draft Red Herring Prospectus (DRHP): The BRLM prepares the DRHP, which is the primary disclosure document. It covers the company's business description, financial statements for typically three years, risk factors, fund utilisation plans, promoter background, related-party transactions, and the terms of the issue. Crucially, the DRHP at the SME stage is filed directly with the exchange (not with SEBI, as is the case for mainboard issues) for review. This is a meaningful difference - SEBI does not independently vet each SME DRHP the way it does for mainboard issues.

Step 3 - Exchange Review and Approval: BSE SME or NSE Emerge reviews the DRHP and may raise queries. Once satisfied, the exchange grants its in-principle approval. The company then files the final prospectus with the Registrar of Companies (ROC).

Step 4 - Opening the Issue: The IPO subscription window opens for a minimum of three working days. The price band (or fixed price) is announced. For SME IPOs, both fixed-price and book-building methods are permitted, though many SME IPOs use the fixed-price method rather than a price band.

Step 5 - Subscription and Application: Investors apply through their stockbrokers using ASBA (Application Supported by Blocked Amount) or UPI mandate. Funds are blocked in the bank account rather than immediately debited, protecting investors until allotment is confirmed.

Step 6 - Allotment and Listing: After the subscription window closes, the registrar processes applications. For SME IPOs, allotment is done on a proportionate basis. If the issue is oversubscribed, applicants may receive fewer lots than applied for. The allotment date, refund initiation date, and listing date follow a prescribed timeline. After listing, shares begin trading on BSE SME or NSE Emerge.

Step 7 - Market Making Begins: From the first day of listing, the appointed market maker begins providing continuous buy and sell quotes, supporting liquidity in the early days of trading.

Throughout this process, the prospectus - specifically the section on risk factors - is the most important document an investor can read. SME companies are required to disclose the specific risks to their business, and reading these risks carefully (rather than dismissing them as boilerplate) can reveal critical information about operational vulnerabilities, customer concentration, regulatory exposures, and promoter-related risks.

Lot Size in SME IPOs: Why It Matters and How It Is Calculated

One of the most talked-about features of SME IPOs - and often the first thing that surprises new investors - is the lot size. In a mainboard IPO, SEBI mandates that the minimum application size should be such that the lot value falls in the range of approximately ₹10,000 to ₹15,000 (this has historically been around one lot worth roughly ₹13,000–₹15,000 for most mainboard issues). This makes mainboard IPOs accessible to a wide range of retail investors.

In SME IPOs, the minimum application size is significantly higher. SEBI's SME framework prescribes that the minimum application amount for an SME IPO should be at least ₹1,00,000 (one lakh rupees). In practice, many SME IPOs set their minimum lot such that the application value is between ₹1 lakh and ₹2 lakh or even higher.

Why is the minimum so much higher? The regulatory intent is to ensure that investors in SME IPOs are, to some degree, self-selected for financial capacity and, implicitly, for sophistication. Because SME companies have thinner disclosures, less analyst coverage, and higher risk profiles, SEBI wants to limit participation to investors who can bear a meaningful loss without catastrophic consequences. The higher lot size acts as a natural filter.

How is the lot size determined? The company and its BRLM decide the issue price (or price band) and then work backwards to determine a lot size such that one lot at the issue price equals at least ₹1,00,000. For example, if the fixed price is ₹50 per share, the lot size would be at least 2,000 shares (2,000 × ₹50 = ₹1,00,000). If the issue price is ₹200 per share, the lot size might be set at 600 shares (600 × ₹200 = ₹1,20,000).

An important practical point is that investors can only apply in multiples of one lot. Unlike mainboard retail applications where you might apply for one lot at ₹14,000, in an SME IPO each application is for at least one lot worth ₹1 lakh or more. If you apply for two lots, your blocked funds will be approximately ₹2 lakh or more depending on the lot value.

The high lot size has two significant implications. First, it concentrates SME IPO investment among investors with larger capital bases, making it less accessible to small retail investors. Second, because the minimum investment is substantial, investors may feel pressure to apply based on grey market premium (GMP) signals or peer recommendations rather than proper due diligence - a dangerous approach. The size of the required investment should, if anything, increase the rigour of your research, not reduce it.

Post-listing, the lot-size convention also affects secondary market trading. On BSE SME and NSE Emerge, shares can be traded in the secondary market in lots (not as individual shares like mainboard stocks). The minimum trading lot in the secondary market for SME-listed stocks is typically the same as the IPO lot size, though this can vary. This further constrains liquidity - if you want to exit, you need a buyer willing to buy in lot-sized quantities, which can be challenging in a thin market.

Investors should always verify the exact lot size, issue price, and minimum application amount from the prospectus or exchange circulars before applying, as these details vary significantly across SME IPOs.

Understanding the Prospectus: What to Look for in an SME IPO Document

The prospectus (or the Red Herring Prospectus in book-built issues) is the foundational document for any IPO, but it assumes even greater importance for SME IPOs because external research coverage is virtually absent. For a large mainboard IPO, you might find analyst reports, news articles, management interviews, and investor presentations to supplement the prospectus. For an SME IPO, the prospectus is often the only substantive source of information.

Here are the key sections every investor should examine:

Risk Factors: This section, typically near the front of the prospectus, lists the material risks to the business. Read every line. Pay particular attention to risks around customer concentration (does the company derive a majority of revenue from just one or two customers?), regulatory dependencies, litigation involving the company or its promoters, and related-party transactions. Some companies list diluted, generic risks; others disclose genuinely material risks. The specificity and honesty of this section is itself a signal.

Business Overview and Objects of the Issue: Why is the company raising money, and what will it do with the proceeds? Specific, credible fund-use plans (e.g., purchasing specific machinery, funding a particular expansion, repaying identified debt) are more reassuring than vague allocations. A large proportion of proceeds going to "general corporate purposes" without detail is a yellow flag.

Financial Statements: Three years of audited financials must be included. Look at revenue trends, profit margins, operating cash flows, and debt levels. A company with consistently rising revenue but deteriorating margins, or one that shows profits but negative operating cash flows, deserves scrutiny. Check whether the financials were audited by a recognised firm - smaller, unrecognised audit firms serving as auditors for small companies have historically been associated with accounting irregularities in some cases.

Promoter Background: Who are the promoters? What is their experience in this industry? Do they have a history of running other listed companies? Have they been subject to any regulatory or legal action? The promoter section of the prospectus and the "Outstanding Litigation" section are important reads.

Valuation: The prospectus will include peer comparison data - price-to-earnings or price-to-book ratios of comparable listed companies. Assess whether the SME IPO is priced at a meaningful discount to peers (which might make it interesting) or at a premium (which demands that the company have a genuinely superior growth story). Be cautious about comparisons with mainboard large-caps that naturally command higher multiples.

Shareholder Structure and Lock-in: Promoters are required to lock in a portion of their shares for a defined period post-IPO. Check the lock-in structure carefully. If promoters have structured the issue in a way that allows them to sell quickly after the lock-in expires, that is worth noting.

Taking the time to read the prospectus - even the sections that feel tedious - is the single most important form of due diligence you can perform on an SME IPO.

How to Apply for an SME IPO: Practical Steps for Indian Investors

For investors who have gone through the mainboard IPO application process, applying for an SME IPO will feel broadly familiar - but there are important differences to keep in mind.

Step 1 - Open the Right Accounts: You need a Demat account, a trading account with a SEBI-registered broker who supports SME IPO applications, and a linked bank account. Not all brokers facilitate SME IPO applications, so it is worth checking in advance. Flattrade, like most full-service and discount brokers with SME capabilities, provides an IPO application interface.

Step 2 - Identify the IPO: SME IPOs are listed on the exchange websites and on the SEBI website. You can find details of ongoing SME IPOs on BSE SME and NSE Emerge portals, including the issue open and close dates, price or price band, lot size, and minimum application amount.

Step 3 - Read the Prospectus: This step cannot be stressed enough. The prospectus is available on the exchange website, the SEBI website, and the registrar's website. Download it and spend time on the risk factors, financial statements, and objects of the issue before making any decision.

Step 4 - Submit Your Application via ASBA or UPI: ASBA (Application Supported by Blocked Amount) is the standard mechanism. Your broker's platform will have an IPO application form. Enter the number of lots you wish to apply for (minimum: one lot at the issue price), your UPI ID or bank account details, and submit. The specified amount will be blocked in your bank account - not debited - until allotment. If you are not allotted shares, the block is released. If you are allotted, the amount is debited and shares are credited to your Demat account.

Step 5 - Check Subscription Status: During and after the subscription period, you can monitor the subscription levels on the exchange websites. For SME IPOs, very high oversubscription (e.g., 100x or 200x) is common and generally indicates strong demand, though as noted, GMP-driven subscription spikes can be unreliable signals.

Step 6 - Allotment and Listing: Allotment basis is disclosed on the registrar's website. Unlike mainboard IPOs where oversubscribed retail applications are allotted via lottery (one lot per applicant), SME IPO allotment is on a proportionate basis. In a heavily oversubscribed SME IPO, each applicant may receive a proportionate number of lots relative to their application.

Step 7 - Post-Listing: Shares are credited to Demat accounts and trading begins. Be aware of the minimum trading lot size in the secondary market. Also be aware that selling in a thin market may be challenging, particularly in the early weeks of listing.

One practical caution: the IPO application window for SME IPOs can be shorter than you expect, and the information available online in the days before opening may be limited. Set aside time well in advance to read the prospectus and make a considered decision rather than rushing to apply on the last day based on social-media chatter.

SME IPO vs Mainboard IPO: A Comparative Overview

Investors who are familiar with mainboard IPOs often ask how SME IPOs differ in practice. While we touched on several differences earlier, it is useful to consolidate a clear comparison across the key dimensions.

Company Size and Stage: Mainboard companies are typically larger, with established revenue streams, wider customer bases, and in many cases institutional or private equity backing. SME IPO companies are smaller, often founder-led, and at an earlier stage in their corporate lifecycle. This translates directly into higher business risk and potentially higher upside - but the upside is not guaranteed.

Minimum Investment: Mainboard retail investors can apply for one lot at approximately ₹13,000–₹15,000, making these IPOs accessible to almost any working adult. SME IPOs require a minimum of approximately ₹1,00,000 per application, restricting participation to investors with larger available capital. This is a regulatory design choice that limits SME IPO retail participation to more financially capable individuals.

Lot Size and Trading: Mainboard IPO allotments are typically in lots of 10–100 shares worth ₹10,000–₹15,000, and after listing, individual shares can be bought and sold on the exchange. SME stocks often trade in lots in the secondary market as well, reducing flexibility.

Regulatory Scrutiny: The DRHP for a mainboard IPO is filed with SEBI and reviewed by SEBI's primary markets department, which issues observations and requires the company to address queries before listing. For SME IPOs, the DRHP is filed with the exchange (BSE or NSE), and SEBI does not independently vet each filing in the same way. This means a lighter level of regulatory review, though exchange-level scrutiny still applies.

Underwriting: Mainboard IPOs are partially underwritten (QIB portion only, in book-built issues). SME IPOs must be 100% underwritten, which ensures the issue does not fail, but the underwriting commitment is typically borne by the BRLM.

Disclosure Frequency: Post-listing, mainboard companies file quarterly earnings results within 45 days of quarter end, publish detailed annual reports, and hold investor/analyst calls. SME companies have somewhat lighter requirements, though they remain bound by SEBI LODR norms calibrated for the SME segment.

Liquidity: Mainboard stocks - especially those in the Nifty 500 or BSE 500 - have deep, liquid secondary markets where millions of shares change hands daily. SME stocks often see thin volumes, and on many days, the market maker may be the only active participant providing two-way quotes.

Return Profile: Mainboard IPOs of quality companies have historically produced consistent, if sometimes modest, listing gains and long-term appreciation. SME IPOs show a wider distribution of outcomes - some produce extraordinary gains, others list below issue price, and some have seen post-listing declines of 50% or more.

None of this makes one route categorically better than the other. They serve different purposes and suit different investor profiles. A conservative investor building a long-term equity portfolio might find mainboard IPOs more appropriate. An investor with a higher risk tolerance, larger capital, and willingness to do deep due diligence might find specific SME IPO opportunities compelling. The key is to make the choice consciously, not by default.

Migration from SME Platform to Mainboard: What It Means for Investors

One of the interesting aspects of investing in SME-listed companies is the possibility of migration to the mainboard - and understanding this pathway can inform an investor's long-term view.

When an SME-listed company grows its business, raises further capital, and its paid-up equity capital exceeds a specified threshold (currently prescribed under SEBI ICDR Regulations - refer the latest version for exact figures), it must migrate to the mainboard. This migration is not automatic; the company must apply to the exchange and satisfy the listing requirements of the mainboard, including filing a new listing agreement, meeting mainboard disclosure and governance norms, and in some cases, providing a further prospectus or offering document.

For shareholders, migration to the mainboard is generally a positive development. It typically brings several benefits: higher liquidity (shares can be traded in single units rather than lots), greater institutional investor attention, broader retail investor access, potentially higher valuation multiples (because mainboard stocks are generally valued at a premium to SME stocks due to superior liquidity), and improved governance standards.

However, migration is not a guaranteed outcome for every SME-listed company. Many SME companies remain on the SME platform for years without growing large enough to trigger migration. Others attempt migration but face challenges in meeting mainboard requirements. And the process of migration itself - with its associated costs and compliance upgrades - can stretch management bandwidth in smaller companies.

For an investor in an SME IPO, the migration potential is worth considering as part of the investment thesis. A company with a credible growth trajectory, scalable business model, and stated ambition to graduate to the mainboard represents a different risk-reward proposition than one that appears likely to remain perpetually small. However, this should be one factor among many, not the sole basis for investment.

It is also worth noting that if a mainboard migration occurs, existing SME-platform shareholders benefit automatically - their shares simply begin trading on the mainboard once the migration is complete, often with an improvement in liquidity and potentially valuation.

Tax Treatment of SME IPO Investments in India

The tax treatment of SME IPO investments broadly follows the same principles as other listed equity investments in India, but there are important nuances that investors must understand. Tax laws are subject to change with each Union Budget, so always refer to the latest Finance Act and consult a qualified tax adviser for your specific situation.

Short-Term Capital Gains (STCG): If you sell shares received via an SME IPO within 12 months of the allotment date, the gains are treated as short-term capital gains. These are taxable at the applicable STCG rate for listed equities. Refer the latest Finance Act for the current rate.

Long-Term Capital Gains (LTCG): If you hold the shares for more than 12 months before selling, the gains are treated as long-term capital gains. For listed equities, LTCG above a specified threshold in a financial year is taxable at the applicable LTCG rate. Refer the latest Finance Act for the exemption threshold and applicable tax rate.

Securities Transaction Tax (STT): STT applies to transactions in listed equity shares - including SME platform-listed shares - on recognised exchanges. STT is levied on both the buyer and the seller, at rates prescribed by the Finance Act.

Dividend Income: If the SME company pays a dividend, it is taxable in the hands of the investor at their applicable income tax slab rate, with TDS provisions applying above specified thresholds. Refer the latest Finance Act for current TDS rates.

Loss Set-off and Carry-Forward: Capital losses from SME IPO investments (short-term or long-term) can be set off against capital gains as per the usual provisions of the Income Tax Act. Consult a tax adviser on the specific rules applicable to your situation.

An important point: the tax treatment of gains from listed SME platform shares is the same as for mainboard-listed shares, provided the transaction occurs on the exchange and is subject to STT. This is generally the case for shares allotted in SME IPOs and subsequently sold on BSE SME or NSE Emerge.

Investors should maintain proper records of allotment dates, allotment prices, and sale prices, as these are required to compute capital gains accurately when filing income tax returns.

Example

Key benefits

How it works

1. 1
   Company Appoints Merchant Banker

   The issuing company appoints a SEBI-registered Category I merchant banker (BRLM) who conducts due diligence and prepares the Draft Red Herring Prospectus (DRHP) disclosing all material information.

2. 2
   DRHP Filed with Exchange

   Unlike mainboard IPOs where the DRHP is filed with SEBI, the SME DRHP is filed with BSE SME or NSE Emerge for review. The exchange raises queries and the company responds before in-principle approval is granted.

3. 3
   Price and Lot Size Fixed

   The company and BRLM determine the issue price (or price band) and the lot size, ensuring the minimum application value per lot is at least ₹1,00,000 as required under the SME IPO framework.

4. 4
   Issue Opens for Subscription

   The IPO subscription window opens for at least three working days. Investors apply through their brokers via ASBA or UPI mandate, blocking funds in their bank accounts for the application amount.

5. 5
   Subscription and Allotment

   After the issue closes, the registrar processes applications and allots shares on a proportionate basis. Oversubscribed applicants receive fewer lots than applied for; unallotted amounts are unblocked promptly.

6. 6
   Listing and Market Making Begins

   Shares are credited to allottees' Demat accounts and begin trading on BSE SME or NSE Emerge on the listing date. The appointed market maker begins providing continuous two-way quotes to support liquidity.

7. 7
   Ongoing Compliance and Potential Migration

   The listed SME company continues to meet SEBI LODR obligations, files periodic disclosures, and may eventually migrate to the mainboard if its paid-up capital exceeds the prescribed SME platform ceiling.

Formula

Minimum Lot Value = Issue Price per Share × Lot Size (must be ≥ ₹1,00,000 per SEBI SME IPO norms)
Oversubscription Multiple = Total Shares Applied For ÷ Total Shares on Offer

Key takeaways

Frequently asked questions

Related terms