NSE puts 90% cap on pre-open price spike for SME IPOs

The National Stock Exchange (NSE), on Thursday, opted to put an overall cap of up to 90% over the issue price for SME initial public offers (IPOs) during the pre-open session. SME stands for small and medium-sized enterprises.

The move, according to the NSE,  aims to standardize opening price discovery across exchanges during the special pre-open session for the SME platform’s IPO.

NSE stated in a circular released today, “The price control cap of 90 per cent shall be applicable only to the SME segment and not for Mainboard IPOs/Relisted Securities/Public Debt.”

According to the NSE, the circular will take effect immediately.

The NSE’s move comes at a time when the IPO/primary market had its strongest first half of any calendar year in 17 years.

Around 120 SME companies have launched their IPOs so far in 2024. Of these, 18 SME IPOs listed at a discount ver issue price and 98 SME IPOs listed at premium.

At present, Ganesh Green Bharat, Effwa Infra and Research, and Ambey Labs’ IPOs are available for subscription.