What is the Difference Between SME IPO and Mainboard IPO?

The difference between SME IPO and Mainboard IPO lies in their scale, rules, and target companies. SME IPOs suit small and medium enterprises raising smaller funds, while Mainboard IPOs target larger firms with stricter norms. Basic differences include minimum capital needs, lot sizes, and regulatory checks. SME IPOs have relaxed entry points but higher entry costs for investors. Mainboard IPOs offer broader reach with more oversight. In this article, the key difference between IPO and SME IPO, along with what is SME IPO and mainboard IPO, are discussed. 

SME IPO vs Mainboard IPO: Key Differences 

The difference between IPO and SME IPO is explained in the table below. 

Which IPO is the Right Option for Businesses? 

Here’s which IPO may be a suitable choice for a business based on their needs. 

• SME IPO fits companies with post-issue capital up to Rs 25 crore needing quick funds for growth. 
• Mainboard IPO suits established firms over Rs 10 crore capital aiming for large-scale expansion and wide investor base.  
• Smaller businesses choose SME for simpler rules and faster process. 
• Larger operations select Mainboard for prestige and deeper liquidity.  
• Businesses weigh capital needs and compliance readiness.

Which IPO is the Right Option for Investors? 

The following ones may be the correct option for investors based on their investment strategy. 

• SME IPO offers high growth potential from smaller firms but carries higher risk due to limited scrutiny. 
• Mainboard IPO provides stability from proven companies with SEBI checks. 
• Investors with high risk tolerance pick SME for possible quick returns. 
• Conservative investors prefer Mainboard for liquidity and lower entry amounts.  
• Both require due diligence on financials and market conditions.  

Conclusion 

Understanding what is mainboard IPO and SME IPO is crucial. The difference between SME IPO vs Mainboard IPO centres on company size, regulations, and investor access. SME suits smaller firms with faster entry, while Mainboard fits larger ones with full oversight. Businesses and investors select based on goals and risk levels. This knowledge aids informed choices in public offerings. Businesses must evaluate capital needs and compliance capacity before choosing a listing route. When applying for IPOs through a share trading app, understanding these distinctions can support informed investment decisions.