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1Clear out junk files and repair common Windows errors2Scan for outdated or missing drivers - takes under a minute3Repair Windows errors before they cause bigger problemsAn IPO does not have to deliver a quick listing gain to serve a purpose: it can raise capital for a company, give existing shareholders a route to sell, or do both. In a Moneycontrol interview published on October 13, 2026, Equirus founder Ajay Garg argues that investors should judge the market over time, while still examining each offer’s valuation, use of proceeds and risks.
Does every IPO have to make money?
No. Garg’s argument is that an IPO should not be judged only by whether its shares rise on listing day or immediately after. Equity investors take on business risk, and companies need time to execute. As he put it: “Equity investing is about underwriting risk and giving businesses time to execute, not expecting every IPO to deliver immediate returns.”
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That is a case for evaluating IPOs as part of a longer-term capital market, not a claim that any particular offer is attractive or that investors should tolerate poor performance indefinitely. A public issue can finance a company whose future is uncertain; some businesses may disappoint while a smaller number of successful outcomes produce larger gains. Garg described a healthy market as one willing to accept that uneven distribution of outcomes.
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Scan for outdated or missing drivers - takes under a minuteDriver Scan →Repair Windows errors before they cause bigger problemsFix Now →Fix the driver behind crashes, sound loss and screen glitchesFind Drivers →The distinction matters because “IPO performance” can mean several different things: whether the offer price was reasonable, whether the stock gained on listing, how it traded months or years later, and whether the company used newly raised capital effectively. A listing pop is one data point, not a full assessment of the business or the public offer.
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What does an IPO fund—and who receives the money?
An IPO may include a fresh issue, an offer for sale (OFS), or both. In a fresh issue, the company issues new shares and receives the proceeds for its stated purposes. In an OFS, existing shareholders sell shares and receive the sale proceeds; the company does not receive that portion. The offer document’s issue structure and stated objects therefore matter as much as the headline issue size.
- Fresh issue: New shares are issued and the company receives the proceeds, subject to the uses described in its offer documents.
- Offer for sale: Existing holders sell shares and receive proceeds. A sale can provide liquidity without adding fresh capital to the company.
- Mixed offer: The issue combines company fundraising and shareholder sales, so investors should distinguish the two amounts and their purposes.
Garg says private-equity investors may sell because they need an exit and want to redeploy capital elsewhere. Promoters, in his account, may sell as a family considers succession, governance changes or professional management, potentially while retaining ownership. Those explanations describe possible motives, not proof that a particular sale is in investors’ interests. Check which shareholders are selling, how much they retain, and what the company says it will do with any fresh-issue proceeds.
Who has the most influence on IPO pricing?
Garg says domestic investors have gained a larger say in pricing than they had previously, and that large investors can have negotiating leverage in very large issues. These are his assessments of market dynamics, not a guarantee about how any individual IPO will be priced. The final offer price reflects the issue process and demand across investor categories, but demand alone does not establish that the valuation is justified.
“IPOs can never be priced exactly,” Garg said. That points to an unavoidable judgment: an issuer and its advisers set a price range for a business whose future results are uncertain, while investors decide what they are willing to pay. A useful assessment compares the offer valuation with the company’s disclosed financial position, prospects and risks, and with relevant listed businesses where comparisons are meaningful.
In the interview, Garg estimated that mutual funds had roughly ₹30,000–40,000 crore per month, or about ₹4–5 lakh crore per year, to deploy. He said IPOs could absorb ₹1.5–1.8 lakh crore, with the balance going to qualified institutional placements (QIPs) and the secondary market. These are Garg’s estimates as quoted in the October 2026 interview, not independently verified current fund-flow totals or a forecast of future IPO demand.
How much does the grey market influence IPO pricing?
Garg says grey-market activity can influence investor behaviour, but it should not be treated as proof that an IPO is fairly priced or will deliver a gain. Informal trading indications are not the same as the listed share price, and they do not replace analysis of the company or the offer documents. Similarly, an issue’s oversubscription shows demand during the subscription period; it does not guarantee a positive listing or later return.
Institutional participation, in Garg’s account, reflects investors’ own analysis. For an individual investor, the practical takeaway is to separate market signals from valuation evidence: subscription figures and grey-market chatter may describe sentiment, but they do not answer whether the price makes sense for the risks involved.
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SEBI Investor provides an IPO investment presentation and other investor-education material. SEBI’s Financial Education Booklet describes applying through a broker or intermediary and using a UPI mandate to block funds pending allotment. It also advises investors to examine a company’s background, prospects and financial strength.
- Read the offer documents. Identify the company’s business, financial condition, disclosed risks and stated purpose for the issue.
- Separate company fundraising from shareholder sales. Work out how much comes from a fresh issue and how much from an OFS, then identify who receives each part.
- Assess valuation, not just demand. Compare the offer price with disclosed fundamentals and relevant listed companies, while accounting for differences in business and risk.
- Consider the investment horizon and uncertainty. A listing-day gain is not assured, and a business may need time to execute. Decide whether the potential risk fits your own circumstances.
- Apply through an available route and follow the mandate process. SEBI’s booklet describes the broker/intermediary route and a UPI mandate that blocks the application amount while allotment is pending; follow the current instructions shown by your intermediary and payment app.
What the interview’s performance examples do—and do not—show
Moneycontrol reported that seven mainboard IPOs were associated with Equirus during the preceding year. At the time of publication, it said six, excluding NSE, were trading above their issue prices; Omnitech Engineering was reported up around 200%, while CMR Green Technologies, described as the weakest performer among those six, was up around 11%. These are dated observations in the October 13, 2026 interview, not current returns, independently verified exchange data, or a representative measure of all IPOs.
The examples illustrate why a snapshot should not be confused with a rule. To assess an IPO outcome, compare the issue price with a later market price at a stated date, distinguish fresh-issue proceeds from OFS proceeds, and consider valuation, investor demand by category and the company’s stated use of funds. One successful or weak cohort cannot establish that all offers are properly priced—or that listing gains are the right test for every business.
Does stronger domestic participation rule out a market fall?
No. Garg says a broader domestic investor base may make the market less dependent on foreign portfolio flows, but he does not say that a sharp correction is impossible. Asked whether a fall of more than 20% was ruled out, his answer was: “Can’t say.” Domestic participation is therefore a factor in the market’s makeup, not protection against losses or a guarantee of stable IPO prices.
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Read the complete Moneycontrol interview with Ajay Garg for his views on IPO pricing, shareholder exits and India’s primary market.
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