SME IPO Explained: Subscription Status, Eligibility, and More
Written by Dev Sethia
4 min read | Updated on November 25, 2025, 17:04 IST
SME IPO - Subscription Status, Details, Meaning, & How to Apply
Demand for capital via SME Initial Public Offerings (SME IPOs) in India’s equity capital markets has increased over the past few years, as small and medium-sized enterprises are entering the public issue market.
Although SME IPOs are targeted at small and medium enterprises, they are growing increasingly popular due to the ease of access to capital and the ability to navigate the regulatory environment.
Below is more information on SME IPOs, including an overview of what they are, how they work, the eligibility criteria and a step-by-step process for investors to follow if they wish to participate in an SME IPO.
What Is an SME IPO?
An SME IPO is a method through which small and medium enterprises raise funds by issuing shares to the public on designated SME platforms of stock exchanges such as the BSE SME or NSE Emerge.
An SME platform is an area of a stock exchange that is specifically designated for small and medium-sized enterprises (SMEs) and is separate from the mainboard, which has specific eligibility and listing requirements that SMEs may not meet in the early to mid-growth phases of a business.
Compared to mainboard IPOs, SME IPOs generally have smaller issue sizes, less comprehensive disclosure obligations and less stringent listing requirements, making them a more approachable option for a business in the early to mid-stages of growth.
Why SME IPOs Matter in Today’s Market?
An increasing number of companies enter areas like manufacturing, technology, services and specialty retail. The demand for accessible funding channels is growing. SME stocks offer this pathway by reducing compliance burdens and not compromising oversight of investor protection.
From an investor perspective, SME IPOs provide exposure to firms with strong growth potential that are not yet on the mainboard. On the flip side, they also expose an investor to the risk of investing in younger companies.
Understanding SME IPO Subscription Status
During the subscription period of an IPO, one of the most important indicators for investors to pay attention to is subscription status, which is an indication of how many times an IPO is subscribed in relation to the number of shares available in the IPO.
Meaning Of Subscription Status
Subscription status indicates the ratio of shares subscribed to the total available shares in the issue. For example, if an issue was subscribed to 10 times, that means investors subscribed to ten times more shares than the company offered.
How Investors Can Track Subscription Status?
There are several ways investors can track either in real-time or periodically updated subscription numbers, such as:
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BSE or NSE official website, where subscription numbers will typically be updated category-wise.
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Broker platforms, where live subscription dashboards are commonly integrated.
How to Apply for an SME IPO?
Applying for an SME IPO involves a systematic approach and interested investors must confirm they manage the necessary accounts and documents. Applications can be made using two systems, ASBA or UPI, both of which have secure payment options.
Get a Demat Account
To invest in any IPO, including SME IPOs, an investor must have a Demat account or a Trading account.
Review the DRHP
Before subscribing to an IPO, investors should carefully review the company’s Draft Red Herring Prospectus (DRHP), which provides detailed information on its business model, financial performance, risks and promoter background.
Choose Your Application Method
Investors can apply using ASBA (Application Supported by Blocked Amount) or UPI (Unified Payments Interface), depending on their bank and broker platform.
Monitor the Allotment
When the subscription period is over, the investors can verify their allocation status on the registry's website or through the BSE/NSE allocation page.
Eligibility Criteria for Companies to Bring SME IPO
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Typically, to list through an SME IPO, a company must:
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Be incorporated under the Companies Act
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Have an operational track record of at least three years
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Maintain certain levels of net tangible assets
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Have demonstrated financial performance, which normally includes positive EBITDA in at least two of the past three years.
These criteria ensure only companies with some level of stability are able to access public funds.
SME IPOs are becoming more relevant for both companies and investors, ahead of growth and an early-stage opportunity. As regulations become easier, there are processes and growing levels of interest in the market, SME listings will move to an increasingly important part of the evolving capital market landscape in India.
About Author
Dev Sethia
Sub-Editor
a journalism post-graduate from ACJ-Bloomberg with over three years of experience covering financial and business stories. At Upstox, he writes on capital markets and personal finance, with a keen focus on the stock market, companies, and multimedia reporting. When he’s not writing, you’ll find him on the cricket pitch
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Upstox is a leading Indian financial services company that offers online trading and investment services in stocks, commodities, currencies, mutual funds, and more. Founded in 2009 and headquartered in Mumbai, Upstox is backed by prominent investors including Ratan Tata, Tiger Global, and Kalaari Capital. It operates under RKSV Securities and is registered with SEBI, NSE, BSE, and other regulatory bodies, ensuring secure and compliant trading experiences.