IPOs increasingly becoming exit vehicles for early investors rather than mechanisms for raising long

While India’s equity markets have grown impressively, initial public offerings (IPOs) have increasingly become exit vehicles for early investors rather than mechanisms for raising long-term capital, said V Anantha Nageswaran, Chief Economic Advisor (CEA) to the Government of India.

“This undermines the spirit of public markets....India’s capital markets must evolve, not just in scale, but in purpose,” said the CEA at CII’s Financing Summit.

Nageswaran underscored that India cannot rely predominantly on bank credit for long-horizon financing. A deep and reliable bond market is a strategic necessity, particularly for financing long-term national objectives.

The CEA noted that insurance and pension funds, whose horizons naturally align with long-term investments, must play a larger role in