SEBI’s 14 October consultation proposes a ₹1 lakh minimum application for SME initial public offerings and one-share secondary-market trading. The combination would alter both primary-order entry and the quantities investors can sell after listing.[1][3]
The application would comprise four lots of at least ₹25,000 each, compared with a current minimum above ₹2 lakh. This is SEBI’s revised proposal, superseding the working group’s two-lot design.[1]
The working group identified fixed secondary-market lots as a constraint on investment size and the disposal of odd-lot holdings. Its one-share recommendation separates those trading restrictions from the minimum commitment required to subscribe to an IPO. Wider participation is the policy objective, rather than an assured improvement in executable liquidity.[2]
The access proposal also changes issuer eligibility
Selected issuer and allocation proposals
| Area | Working-group recommendation carried into consultation |
|---|---|
| SME platform eligibility | Post-issue market capitalisation up to ₹1,000 crore requires the SME route; above ₹1,000 crore to ₹4,000 crore permits it. |
| Normal profitability route | Average operating profit of at least ₹3 crore a year over the preceding three financial years. |
| Minimum allottees | Increase from 200 to 500. |
SEBI also proposes an alternative for issuers missing the profit test: book building with at least 75% of the net offer allotted to qualified institutional buyers, or a full subscription refund. Other eligibility requirements would remain.[1]
Single-share trading would require a separate subsequent circular after the revised framework is notified. That circular would also end the existing mandatory market-making framework. Comments are due by 4 November; the effective date remains to be set.[1]
For brokerage platforms, the distinction is practical: IPO application validation and secondary-market quantity controls serve different purposes. Separating them would let customers adjust a listed holding in smaller amounts while preserving a larger commitment at the offer stage.[2]
Sources & further reading
- Consultation Paper on Recommendations pursuant to Review of provisions of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 related to Initial Public Offer by Small and Medium Enterprises Securities and Exchange Board of India · 14 Oct 2026 · Accessed 20 Oct 2026
- Review of provisions of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 related to Initial Public Offer by Small and Medium Enterprises — Working Group Report, August 2026 Securities and Exchange Board of India · Accessed 20 Oct 2026
- Consultation Paper on Recommendations pursuant to Review of provisions of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 related to Initial Public Offer by Small and Medium Enterprises — publication notice Securities and Exchange Board of India · 14 Oct 2026 · Accessed 20 Oct 2026