By ipomarket.in Editorial Team · Last reviewed: 2026-10-26
Disclaimer: This article is for informational purposes only and does not constitute investment advice. IPO investments are subject to market risks. Please read the offer document carefully and consult a SEBI-registered investment advisor before investing.
A strong debut does not guarantee a strong investment. That single idea sits at the centre of India's 2025 IPO data, and it is worth unpacking carefully because the gap between listing-day profits and longer-term holding outcomes has widened.
In 2025, 108 mainboard IPOs raised ₹1,83,432 crore. Of those 108 listings, 65% opened at a profit on debut day. Yet by 31 December 2025, only 41% were still trading above their listing price. In other words, a majority of companies that popped on day one had given back those gains within the same calendar year.
The listing-gain squeeze
The headline number most retail investors watch, listing gain, shrank dramatically. The median listing gain for mainboard IPOs in 2025 was 3.8%, down sharply from 15.2% in 2024.
KPMG's analysis of the same period found average listing-day gains in FY 2025-26 declined to 8% from 28% in the previous fiscal year. Measured by median or by average, the message is the same: the easy pop that defined earlier cycles has faded.
For context, 2024 was a very different market. According to Trendlyne data, in 2024 some 303 IPOs opened on listing day in profit against 37 that opened in loss, with an average listing gain of 48.97%. That figure covers a broad set of listings and should be read as reported rather than a like-for-like comparison with the mainboard-only 2025 numbers above.
What happens after the listing bell
The more important story is what happens in the months after listing. According to data cited by IndMoney, a majority of 2025 IPOs, 59% or 64 IPOs, are trading below their listing-day price. So the drop is not confined to a handful of weak debuts; it is broad.
Prime Database analysis, as reported, found that of 177 of the top 200 IPOs tracked, 99 had one-year returns that lagged behind their listing-day gains. That is more than half of the sample where holding for a year left investors worse off than the listing-day snapshot would have suggested.
You can follow how specific issues have fared after listing on our 2026 performance tracker and the broader IPO news section.
Why high subscription is not a reliable signal
Many retail applicants treat heavy oversubscription as a sign of a sure-shot listing gain. The 2025 data undercuts that assumption. As reported by IndMoney, the VMS TMT IPO was subscribed 102.2 times but listed at -4.38%, while Studds Accessories was subscribed 73.2 times yet listed at -3.42%.
Subscription measures demand for allotment, not the quality or valuation of the business. Our explainer on QIB, NII and retail subscription data walks through why these categories behave differently and why the overall multiple can mislead.
Retail enthusiasm itself cooled slightly. According to Kotak, retail subscription for IPOs moderated from 33.71 times in 2024 to 26.99 times in 2025.
SEBI's findings on selling behaviour
The behavioural side is where SEBI's research is instructive. SEBI's 2024 study of 144 mainboard IPOs found that individual investors sold 50% of their allotted shares by value within a week of listing. The same study found that retail investors were far more likely to book quick profits when the gains were large: 67.6% sold when listing returns exceeded 20%.
This is the classic disposition effect, selling winners fast. It is not inherently wrong, but combined with the data above, it raises a question: if most IPOs fade after listing, quick selling may sometimes be the sensible outcome rather than a mistake. The real problem is applying one rule to every IPO regardless of the underlying business.
Mainboard versus SME
The split between mainboard and SME listings is worth noting. As reported by Trendlyne, SME IPOs listed at an average gain of 10.3% in 2026 versus 8.7% for mainboard IPOs, which looks favourable at first glance. But only 55% of SME listings trade above their issue price versus 79% of mainboard listings. The higher average SME gain masks a wider spread of outcomes and a larger share of listings that slip below issue price.
If you are weighing the two segments, our guide to mainboard versus SME IPO differences covers the structural gaps in disclosure, liquidity and risk.
The tax angle on selling early
When you sell matters for tax too. Selling IPO shares on listing day produces Short-Term Capital Gains, taxed at 20% on the profit. Holding for more than 12 months shifts the gain to Long-Term Capital Gains, taxed at 12.5% on gains exceeding ₹1.25 lakh. Retail investors have complete freedom to sell on listing day, with no lock-in period, so the choice is entirely theirs.
The tax difference is not a reason on its own to hold a weak business, but it is a real cost that frequent listing-day sellers sometimes overlook. For a fuller treatment, see our listing day sell-or-hold exit strategy analysis.
What the data actually tells retail investors
Put the pieces together and a clearer picture emerges:
- Listing-day profit is common (65% opened in profit in 2025) but fragile (only 41% held gains by year-end).
- Median listing gains have compressed hard, from 15.2% in 2024 to 3.8% in 2025.
- Subscription multiples, even extreme ones above 100 times, did not reliably translate into listing gains.
- Most investors sell quickly, and most IPOs fade, so the two behaviours partly cancel out, but neither is a substitute for judging the business.
None of this says IPOs are good or bad as a category. It says the listing-day number that dominates headlines is a weak guide to how an investment actually performs. Separating the debut pop from the 12-month reality is the lesson the 2025 data drives home.
FAQ
Did most 2025 IPOs make money on listing day?
Yes, in the sense that 65% of the 108 mainboard IPOs listed in 2025 opened at a profit on debut day. But by 31 December 2025, only 41% were still trading above their listing price, so the debut profit often did not last.
Why did listing gains fall so much in 2025?
The median listing gain for mainboard IPOs dropped to 3.8% in 2025 from 15.2% in 2024, and KPMG reported average listing-day gains in FY 2025-26 fell to 8% from 28% the prior fiscal year. The data shows compression but does not assign a single cause; several market factors were at play.
Does heavy subscription mean a guaranteed listing gain?
No. As reported by IndMoney, VMS TMT was subscribed 102.2 times but listed at -4.38%, and Studds Accessories was subscribed 73.2 times but listed at -3.42%. Subscription reflects demand for allotment, not valuation or listing performance.
Is it better to sell on listing day or hold?
The data does not give one answer for every IPO. SEBI's 2024 study found individual investors sold 50% of allotted shares within a week, and 67.6% sold when listing returns topped 20%. Separately, selling on listing day is taxed at 20% STCG versus 12.5% LTCG on gains over ₹1.25 lakh if held beyond 12 months. The right choice depends on the specific business and your goals, which is why this is analysis and not advice.
Do SME IPOs perform better than mainboard IPOs?
It is mixed. Trendlyne reported SME IPOs listed at an average 10.3% gain in 2026 versus 8.7% for mainboard, but only 55% of SME listings trade above issue price versus 79% of mainboard listings. The higher average comes with a wider spread of outcomes.
Last reviewed: 2026-10-26 by the ipomarket.in Editorial Team.