The Securities and Exchange Board of India (SEBI) is investigating three to four IPO advisory firms operating in the small and medium enterprise (SME) segment.
The probe was prompted by complaints that these unregistered entities are assisting companies in generating substantial responses to their IPOs and promising significant listing gains.
These firms, predominantly based in Mumbai and Ahmedabad, have gained a large market share by leveraging their networks of brokers and high-net-worth individuals (HNIs) to facilitate IPOs.
They are essentially performing merchant banking functions without holding the required Sebi license, thus bypassing regulatory constraints.
Data from Prime Database reveals that SME IPOs have set a record this year, raising Rs 4,800 crore from 144 companies between January and July. This exceeds last year’s total of Rs 4,686 crore from 182 SME IPOs.
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Last reviewed by Abhishek Sharma on August 31, 2026
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