IPOs 2025: High OFS a continuing trend; concerns not met with facts, says SEBI Chairman Tuhin Kanta Pandey

SEBI's whole-time member, Kamlesh Varshney, said that exit routes are necessary for investors and warned that India will not be able to attract the required investments otherwise.

Pandey told reporters that the offer-for-sale (OFS) component accounted for 51% of the money raised in initial public offerings (IPOs) in April–October 2024, which has gone up to 57% this year.

"So to say that something exceptional has happened is also not met with facts," Pandey said.

It can be noted that a few days ago, Chief Economic Advisor V Anantha Nageswaran went public with his concerns on the high component of OFS, saying the IPOs are becoming an exit vehicle for early investors and undermining the spirit of public markets.

Nageswaran had advised that the country's capital markets should evolve "not just in scale, but in purpose" as well.

"India's equity markets have grown impressively, but initial public offerings (IPOs) have increasingly become exit vehicles for early investors, rather than mechanisms for raising long-term capital. This undermines the spirit of public markets," the CEA had said.

Pandey said that money is a fungible commodity and comes at any time in the journey of a company.

"...this particular debate has to be looked at in the context of capital formation. Capital formation will have different models. There is no one single model," Pandey said, reminding that India's aspirations to be a $5 trillion economy and stressing that we have the maturity to deal with eventualities.