SME IPO 2024 Returns Over the Past 1-2 Years Indicate that Can Provide Long Term Value, But There is a Caveat

The ongoing excitement surrounding SME IPOs has sparked an important discussion regarding their long-term value, especially as scrutiny from regulators and market experts increases. Concerns over inflated valuations and speculative behavior have prompted a closer examination of whether these offerings serve merely as quick profit avenues or if they genuinely provide sustainable returns. Recent analyses show a mixed performance among SME IPOs launched between September 2022 and September 2023, with a notable number achieving significant price appreciation. ETMarkets conducted an analysis of 105 SME IPOs during this period, revealing that 55 companies have delivered multibagger returns. The average price increase stands at an impressive 373%, with some IPOs witnessing gains as high as 2,400%.

SME IPO 2024

However, the data also reveals a segment of these IPOs offering returns below 50%, raising questions about the long-term viability of certain business models. Industry experts emphasize that thorough due diligence and a focus on fundamentals are crucial for investors considering these opportunities. As market participants grapple with these insights, there is a growing acknowledgment of the potential for sustainable growth in well-managed SME companies. With calls for heightened scrutiny and proper investor education, the SME IPO landscape remains a dynamic space, balancing the lure of high returns with the need for cautious investment strategies.