Post-issue paid-up capital up to ₹10 crore.

Post-issue market capitalisation at the offer price up to ₹1,000 crore. Such issuers must use the SME Platform.

Mixed. The platform no longer depends on how share capital is structured, so bonus issues to manage paid-up capital lose their purpose.

Companies valued up to ₹1,000 crore at offer price lose the Main Board option.

Based on actual record, the largest SME IPO till now (Q-Line Biotech gathered ₹214.5 crores in May 2026, so the limit of ₹250 crores for SME IPO looks reasonable and practical).

This also bring clarity of where a company is actually meant to be at a point of time as we have seen that many Promoters keep on evaluating both these options and are unable to decide how to move forward. This change brings certainty now.

Positive. The platform reflects the price investors pay.

Traditionally Mainboard IPOs are meant for larger companies (now coded – over ₹250 crores IPO size). We favour this segregation of linking IPO based on post issue market cap as there are also different category of Investors for SME and Mainboard segment.

Bringing a SME size company on Mainboard was doing not much benefit either and was primarily done to avoid the limitations prescribed under SME Regulations which are now proposed to be rationalised.

Simultaneously measures like post listing Trading in even 1 share will increase liquidity. Relaxation of QIB OFS norms will support more such IPO’s on SME platform.

Valuation is market driven and what Investors find attractive, will get the price too.

Paid-up capital above ₹10 crore and up to ₹25 crore may use the SME route.

Market capitalisation above ₹1,000 crore and up to ₹4,000 crore may use the SME route, with restated consolidated Ind AS financial statements for three years and any stub period.

Mixed. Mid to Large size SMEs keep a choice of platform.

Companies with Market capitalisation above ₹1,000 crore and up to ₹4,000 crore choosing SME platform will have to follow Ind AS financials and should start well before filing.

There could be impact on the quantum of Sales and Profits and detailed disclosure requirements under Ind AS financials. Transitional provisions shall apply.

Mainboard companies already follow Ind AS financials.

Positive. Mid to Large SME issuers report on the same basis as Main Board peers, so there is consistency and better reliability on their reported financials.

Investors expect transparency and Ind AS financials will bring more Trust and credibility.

No re-test of Platform at the RHP stage.

At RHP or Prospectus: a Main Board filer valued at ₹1,000 crore or below re-files under SME; an SME filer above ₹1,000 crore may continue up to ₹4,000 crore; above ₹4,000 crore it re-files under the Main Board.

Mixed. A change in valuation between DRHP and RHP can force a re-filing and delay the issue.

In general, this decision must be planned on Day 1 itself and then followed.

Practically, we do not see much impact of this.

Mixed. The platform follows the final pricing at the time of RHP.

Withdrawal and Refiling is always an option with the Issuer and this decision can be taken by the Issuer company in consultation with the Merchant Bankers and Investors before taking action.

One full financial year as a company after conversion from a proprietorship, firm or LLP before DRHP filing. The effective wait of 12 months plus.

Four consecutive completed quarters from conversion, and at least one post-conversion audited financial statement (or part) filed with the RoC before the DRHP.

Positive. A uniform cooling off period of about a year, whatever the conversion date.

Positive. Uniformity of timing saves time and reduces uncertainty of Investors evaluating such companies.

Not expressly provided

Extends to acquisitions, transfers, vesting, succession and schemes where more than 50% of latest-year revenue comes from a business earlier run by a proprietorship, firm or LLP.

Mixed. Businesses done in group entities get credit for their operating history. Same rules apply as in case of conversion.

Positive. The same rule applies whatever legal route the reorganisation takes.

Operating profit (EBITDA) of ₹1 crore in at least two of the last three financial years.

Average operating profit of at least ₹3 crore a year over the preceding three financial years (Total ₹9 crore EBITDA in aggregate), on restated consolidated statements.

Mixed. Companies near the old ₹1 crore floor fall out of the standard route. Averaging means one weak year no longer disqualifies. Recompute now on a restated consolidated basis. Many smaller Companies will disqualify now.

Positive. The bar is three times higher and measures sustained performance.

Investors practically back companies with not less than 3-5 crore profitability, so they get the relevant companies.

None. An issuer failing the profit test cannot list on the SME Platform.

Book building; at least 75% of net offer to QIBs; full refund if not met. Retail capped at 10% and NII at 15%; QIB portion not underwritten; no OFS relief for QIB sellers in this case.

Positive. Pre-profit, growth-stage companies gain access, as on the Main Board under Reg 6(2). The route depends on genuine institutional demand and carries refund risk.

Positive. Institutions carry at least 75% of the book and retail exposure is capped at 10%. Use of the route signals that the profit test is not met.

Lower of 15% of the amount raised or ₹10 crore.

15% of the amount raised; ₹10 crore cap removed.

Positive. GCP flexibility now scales with issue size. Not Capped.

Mixed. The 15% ceiling still stays tighter than the Main Board’s 25%.

No minimum holding period for shares offered for sale.

Shares must be held for one year before the DRHP is filed.

Mixed. Investors who enter within a year of filing cannot sell in the IPO. Time pre-IPO rounds accordingly.

Positive. New protection: shares acquired shortly before the IPO cannot be sold to the public.

OFS up to 20% of issue size; each seller up to 50% of pre-issue holding (fully diluted).

Limits retained for non-QIB sellers. QIB sellers are exempt from these limits subject to 1 year holding period condition.

Positive. A clear exit route makes pre-IPO funding from QIBs easier to raise. Promoter exits remain capped. Providing flexibility to genuine QIB selling shareholders would facilitate appropriate exits and support continued institutional participation in growth-stage enterprises

Mixed. A QIB can sell its entire holding in the IPO, adding secondary supply. The one-year holding period and cumulative computation are the safeguards.

Not applicable.

QIB exemptions not available here. The 20% and 50% limits apply to all sellers.

Neutral. Sellers must plan within the standard limits.

Positive. The alternative route raises primary capital, not exits (as Reg 8A on the Main Board).

Three years from the later of IPO allotment or commencement of commercial production.

Three years from IPO allotment.

Positive. The end date is certain from allotment.

Neutral. The three-year period, twice the Main Board’s 18 months, is retained.

50% locked in for two years and 50% for one year.

Entire excess locked in for one year.

Positive. Half of the excess holding is now released a year earlier.

Mixed. Promoters may sell more from the second year. The minimum contribution remains locked for three years.

One year from allotment.

Six months from allotment, as on the Main Board. Existing exemptions (ESOPs; Category I and II AIFs and VCFs with a one-year holding) retained.

Mixed. Free float rises earlier, with a possible supply overhang at six months.

Positive. Pre-IPO investment becomes more attractive.

No separate lock-in.

Separate one-year lock-in.

Neutral. Group holdings need planning for the first year.

Positive. Closes the use of group entities to sell early.

No provision.

Depositories may record securities as “non-transferable” where lock-in cannot be created otherwise.

Neutral. Operational.

Positive. Lock-in becomes enforceable in all cases.

Two lots, with value above ₹2 lakh (raised by the amendment notified on 4 March 2025).

Four lots, each of at least ₹25,000: minimum ₹1 lakh.

Positive. It is expected to result in widen no. of Investors, still with minimum ₹1 lakh IPO investment.

Mixed. More individuals can apply, with lot size reduced to ₹25k each. Minimum 4 lot size investment aimed to limit smaller retail participation whereas by limiting ₹1 Lakh amount, more opportunities emerge for Retail investors.

At least 35% to individuals applying for the minimum size, at least 15% to NIIs, up to 50% to QIBs (5% for mutual funds).

Same percentages, using “Retail Individual Investor” terminology aligned with the Main Board.

Neutral. No change to the shares available.

Neutral. Categories become consistent across platforms.

Not applicable.

Up to 10% to RIIs, up to 15% to NIIs, at least 75% to QIBs.

Neutral. Mirrors the Main Board rule.

Positive. Retail exposure to issuers that miss the profit test is limited.

Not expressly provided.

Up to 60% of the QIB portion in book-built issues, under Schedule XIII conditions.

Positive. An anchor book gives an early price signal and demand (No change)

Positive. Anchor allocation is known before the issue opens (No change)

One-third for applications of more than two lots up to ₹10 lakh; two-thirds above ₹10 lakh.

One-third for ₹2–10 lakh; two-thirds above ₹10 lakh (as Reg 32(3A)).

Neutral.

Neutral. Value-based categories, consistent with the Main Board.

Allotment in minimum lots and multiples of the lot.

Each RII receives at least one minimum lot, subject to availability; the balance is allotted proportionately, not in multiples of the lot.

Neutral.

Positive. Shares are spread more evenly in oversubscribed issues.

200.

500.

Mixed. Smaller issues must secure wider distribution or fail.

Positive. A wider shareholder base from listing supports liquidity.

Price-based lots from 100 to 10,000 shares, equal to the IPO lot.

One share for all SME-listed securities, from the date of the circular rescinding the 2012 circular.

Positive. Institutions can build positions of any size.

Positive. Odd-lot holdings (about 5% of unique PAN holders) end; whole holdings can be sold.

100% of the issue underwritten; lead managers underwrite at least 15% on their own account.

Main Board model: the unsubscribed portion is underwritten. The mandatory QIB portion in Reg 229(7) issues is not underwritten.

Mixed. Issues would be sold on their strengths and market acceptance. Sector, Business, Sales growth, Profit growth, potential Opportunity would be evaluated. Merchant Banker track record would matter too.

Not all issues may subscribe without Underwriting commitments.

Mixed. Underwriting was to cover Risk. Each mandate will sell differently.

Registrar to confirm 90% subscription before the issue closes.

90% minimum subscription, with refund if not achieved.

Neutral. Aligns with Main Board practice.

Positive. The issue completes only at the prescribed subscription level.

Compulsory for three years with 5% inventory. Fees were 1.58% (NSE) and 2.60% (BSE) of issue expenses in FY 2025-26.

Withdrawn. Existing arrangements cease for all SME-listed companies on the date of the rescission circular.

Positive. Saves fees and inventory. Listed SMEs must wind down existing agreements.

Mixed. There is no appointed counterparty in thin scrips. Market makers were 0–10% of turnover in 629 scrips, and the one-share lot and 500 allottees support liquidity.

A listed issuer with paid-up capital below ₹25 crore may move to the SME Platform by special resolution.

Removed.

Mixed. The option of moving to the SME Platform closes.

Positive. Main Board shareholders keep the Main Board regime.

Paid-up capital above ₹10 crore and up to ₹25 crore, with shareholder approval.

Market capitalisation of ₹1,000 crore or more but below ₹4,000 crore, subject to the Main Board exchange’s criteria.

Positive. Graduation follows company value.

Positive. A clear graduation path for growing companies.

Shareholder approval.

Board approval sufficient.

Positive. Faster and cheaper.

Neutral. Shareholders lose the vote, but the company moves to a stricter regime.

Mandatory migration where a further issue takes paid-up capital above ₹25 crore, unless Main Board LODR norms are followed.

Removed.

Positive. Rights, preferential and bonus issues without forced migration.

Neutral.

No value-based trigger.

Above ₹4,000 crore market capitalisation, using twelve-week average prices on the date of the migration application. A later price fall does not reverse the obligation.

Mixed. Large SMEs take on the Main Board regime. The averaging method avoids triggers from price spikes.

Positive. Companies of Main Board scale move under Main Board rules.

Not applicable.

New rules apply to companies listed after notification. Companies listed at notification keep the paid-up-capital rules.

Mixed. Two migration regimes run on one platform.

Neutral. No retrospective change for existing holders.

20% by equity shares or convertible securities. No provision for partly paid-up IPOs.

Aligned with Reg 14: SR equity shares count; where the contribution exceeds ₹100 crore in a partly paid-up IPO, at least ₹100 crore before opening and the rest pro rata before calls.

Positive. More ways to meet the contribution.

Neutral.

Excludes securities allotted in the preceding year below the issue price to promoters and AIFs.

Categories aligned with Reg 15(1)(c) for the Main Board.

Neutral.

Positive. The same test applies across platforms.

Material disclosures required in the offer document.

Material disclosures required in both the draft offer document and the offer document.

Mixed. Disclosure liability starts at the DRHP stage.

Positive. Earlier and more complete disclosure.

Offer document filed with SEBI on RoC filing; no SEBI observations; due-diligence certificate with site visit report.

Updated DRHP filed with the SME exchange incorporating its observations, with changes highlighted. Schedule XVI changes need an updated or fresh DRHP (no extra fee). Site visit report retained; specified certificates at DRHP stage.

Mixed. More documentation, but processing stays with the exchange and no SEBI fee applies.

Positive. Exchange observations are reflected in the document investors read.

Cap no more than 120% of the floor; no minimum spread.

Cap at least 105% and no more than 120% of the floor.

Neutral.

Positive. The price band becomes a real range for price discovery.

Discount linked to individuals applying for the minimum size; uniform minimum application lot for all applicants.

Those references deleted. Retail and employee reservation discount up to 10%; anchors not below the price to others.

Neutral.

Neutral. Consistent with the revised application framework.

Pre-issue advertisement after filing the prospectus; lead manager responsible until completion of the issue process.

Advertisements refer to the RHP or Prospectus as applicable. Lead manager responsible until allotment, refund, demat credit and listing or trading permission (as Reg 52(3)).

Neutral.

Positive. Lead manager accountability is defined through to listing.

Not applicable.

Revised framework mandatory for DRHPs filed three months or more after notification in the Official Gazette.

Positive. Three months of lead time.

Neutral.

Not applicable.

DRHPs filed in the first three months may choose either framework and must say which in the DRHP.

Positive. Compare both routes: for example, paid-up capital of ₹25 crore or more with a valuation below ₹1,000 crore means Main Board today but SME under the revised framework.

Neutral.

Not applicable.

RHP filed on or before notification: existing framework. Main Board DRHP filed before notification: existing Main Board framework. SME DRHP filed before notification without in-principle approval or RHP: choice by addendum.

Positive. No disruption to issues in progress.

Neutral.

Not applicable.

Existing lock-ins run to expiry; market making ends on the rescission circular date; migration under existing rules.

Positive. Market-making cost ends.

Mixed. Market-making support ends before the three years originally disclosed.