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Experts believe this trend reflects growing optimism around capital markets, but they also caution retail investors about the risks involved in pre-IPO investing.
Investor interest in the unlisted shares of NSE, Hero FinCorp, and HDB Financial has increased in anticipation of their IPOs.
Pre-IPO Investment: The primary market has rebounded after a period of subdued demand. Recent weeks have seen several main board and SME IPO launches seeking to raise capital from investors. This renewed investor appetite for IPOs has corresponded with a sharp rise in grey market prices for unlisted shares of companies such as NSE, Hero FinCorp, and HDB Financial. Unlisted shares of NSE reached a record high of Rs 2,300 last month following renewed discussions with SEBI regarding a potential IPO. Similarly, unlisted shares of Hero FinCorp and HDB Financial have also appreciated in anticipation of their respective IPOs.
Experts believe this trend reflects growing optimism around capital markets, but they also caution retail investors about the risks involved in pre-IPO investing.
Investor interest in the unlisted shares of NSE, Hero FinCorp, and HDB Financial has increased in anticipation of their IPOs, says Krishna Patwari, Founder and Managing Director of Wealth Wisdom India. “These developments have raised demand for their unlisted shares, with investors hoping to profit from future profits if the companies go public,” he adds.
Prices of unlisted shares tend to reflect a combination of demand-supply dynamics and sentiment, says Incred Money Team. “Just like in the listed space, when demand for a stock outweighs available supply—especially in the absence of fresh issuance — premiums tend to rise, which is the case for NSE at the moment. That being said, unlisted prices isn’t always a clear reflection of intrinsic value,” it cautions.
Patwari highlighted that the current valuations of unlisted shares appear driven by both company fundamentals and increased investor demand. On May 31, 2025, the price of NSE’s unlisted shares soared from Rs 1,600 on May 1 to Rs 2,375, marking its highest point to date. This rapid increase reflects a positive market attitude, supported by strong financials.
Additionally, Hero Fincorp and HDB Financial have garnered significant interest, with their share prices reaching Rs 1,650 and Rs 1,250 respectively as they approach their IPOs. Both companies operate in well-established sectors and continue to attract investment.
Risk For Retail Investors Before IPO
Both Expert caution that some risks are associated with unlisted shares retail investors must know before investing in them. Liquidity risk, lock-in-period, valuation and market risk and lack of transparency are issues that must be considered by retail investors before investing in pre-IPO shares.
Liquidity risk: Unlike listed shares, unlisted shares cannot be freely traded. Exits can take time and depend on finding a counterparty. That’s why a long-term perspective is crucial.
Lock-in period: Post listing, SEBI mandates a 6-month lock-in period for pre-IPO investors. This means even if the company lists successfully, you won’t be able to sell immediately.
Valuation and market risk: Prices in the unlisted space are not as transparent. The valuation can fluctuate based on sentiment, company performance, or even regulatory announcements. While we might expect for the unlisted share to list at a premium to your buying price. It is rather possible that the unlisted share might list at a discount.
Lack of transparency: Detailed and updated financial information is often not publicly available.
While these risks exist, they can be managed by investing wisely, conducting due diligence, and having realistic expectations.
Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian Inst…Read More
Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian Inst… Read More
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