In short: Ahmedabad’s relationship with organised capital markets goes back further than most cities’: the Ahmedabad Stock Exchange, founded in 1894, was India’s second stock exchange after Bombay, and served the city’s textile mills and trading houses for over a century before voluntarily exiting the exchange business in 2018. That legacy now runs through a different channel — the BSE and NSE mainboards and the BSE SME and NSE Emerge platforms — and Gujarat’s textile, chemical, pharmaceutical, engineering and ceramics manufacturers, along with a generation of family-owned trading houses now working through succession, are increasingly the companies using it. This guide sets out how an IPO consultant in Ahmedabad fits alongside the merchant banker, the current SEBI eligibility tests for the mainboard and SME routes, the process to T+3 listing, realistic timelines and costs, the Gujarat-specific support available to an eligible MSME issuer, and how I support Ahmedabad companies through the readiness and financial-preparation work that decides whether a listing succeeds.
By CA Murli Chandak, FCA — Fellow Chartered Accountant and IBBI-Registered Valuer (Securities or Financial Assets), registration IBBI/RV/07/2021/14408, with 8+ years in valuation, audit and advisory practice. Regulatory citations verified against SEBI, NSE and NSDL sources as at September 2026.
Contents
- 1. Why Ahmedabad Companies Are Looking at an IPO in 2026
- 2. What an IPO Consultant Does, and How the Role Sits Alongside the Merchant Banker
- 3. Mainboard vs SME IPO: Eligibility Under the ICDR Regulations
- 4. IPO Readiness: What I Test Before Appointing Anyone
- 5. The IPO Process, DRHP and RHP
- 6. Financial Preparation, Governance and What an IPO Costs
- 7. Common IPO Readiness Mistakes Ahmedabad Companies Make
- 8. IPO Readiness Services From CA Murli Chandak
- 9. Frequently Asked Questions
- Discuss Your IPO Readiness
1. Why Ahmedabad Companies Are Looking at an IPO in 2026
Ahmedabad’s link to organised capital markets is old. The Ahmedabad Stock Exchange, constituted in 1894, was India’s second stock exchange after the Bombay Stock Exchange and, for well over a century, the venue where the city’s textile mills and trading families raised and traded capital. It moved to screen-based trading in 1996, and in April 2018 SEBI permitted it to voluntarily exit the stock-exchange business, as it did for most of India’s regional exchanges once trading consolidated onto the NSE and BSE. What has not changed is the underlying appetite: Gujarat’s industrial base — textiles, chemicals and petrochemicals, pharmaceuticals, engineering, plastics, ceramics around Morbi, and gems and jewellery around Surat, alongside Ahmedabad’s own GIDC estates — continues to produce companies that outgrow bank financing and look to the public markets, now through the BSE and NSE mainboards or the BSE SME and NSE Emerge platforms.
A public listing gives these companies growth capital without loan covenants, a market-determined valuation, liquidity for promoters and early investors, and the credibility that comes with public disclosure. For a number of Ahmedabad’s family-owned textile, chemical and trading houses — several running into a second or third generation — it also forces the succession and governance questions that closely held businesses can otherwise defer indefinitely. It remains, at the same time, one of the most demanding transactions a company will undertake: restated financial statements, a lengthy offer document, a dozen or more intermediaries to coordinate, and a permanent change in how the business governs itself. Whether that transaction lands on time and at the intended valuation is usually decided well before a merchant banker is appointed, and that preparatory phase is where an IPO consultant in Ahmedabad earns the fee.
2. What an IPO Consultant Does, and How the Role Sits Alongside the Merchant Banker
The two roles are frequently conflated. The merchant banker — the Book Running Lead Manager on a mainboard issue, the Lead Manager on an SME issue — is a SEBI-registered intermediary under the SEBI (Merchant Bankers) Regulations, 1992. It conducts due diligence, drafts and files the offer document, signs the due-diligence certificate to SEBI and the exchanges, and runs the book. Its obligations run to the regulator and to investors as much as to the company.
The IPO consultant is engaged by the company itself and works purely in its interest, typically appointed before the merchant banker and staying alongside it: testing eligibility, running the readiness diagnostic, organising financial and corporate information, building the valuation and equity-story groundwork, and keeping the overall programme on schedule. A company that reaches the merchant banker’s diligence with restated numbers already reconciled and related-party transactions already documented shortens the timeline and typically negotiates better commercial terms.
For Ahmedabad’s family-owned textile, chemical and engineering groups — several formalising, for the first time, arrangements that have run informally between group entities for decades — the readiness and financial-preparation work is where the value concentrates most visibly. In my engagements this diagnostic and preparation phase forms the core of the work; the SEBI-registered merchant banker is then appointed onto a company that is genuinely ready for it.
3. Mainboard vs SME IPO: Eligibility Under the ICDR Regulations
The first strategic decision is the platform. The mainboard of the NSE and BSE sits under Chapter II of the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018; the SME platforms — NSE Emerge and BSE SME — sit under Chapter IX. Both frameworks were materially tightened through the SEBI (ICDR) (Amendment) Regulations, 2025 and refined again in March 2026.
On a restated, consolidated basis, Regulation 6(1) requires net tangible assets of at least ₹3 crore in each of the three preceding years, average operating profit of at least ₹15 crore over those three years with profit in each year, net worth of at least ₹1 crore in each year, and minimum promoter contribution of twenty per cent of post-issue capital under Regulation 14. A company that cannot meet the profitability test may still list under Regulation 6(2), provided at least seventy-five per cent of the net offer goes to qualified institutional buyers — the route most relevant to asset-light or still-scaling businesses.
On the SME platforms, Regulation 229 now requires operating profit (EBITDA) of at least ₹1 crore in at least two of the three preceding years, post-issue paid-up capital not exceeding ₹25 crore, an offer-for-sale cap of twenty per cent of the issue, general corporate purposes capped at the lower of fifteen per cent or ₹10 crore, a minimum application of two lots, mandatory full underwriting, market making for a prescribed period after listing, and a one-year cooling period after conversion from a proprietorship, partnership or LLP.
| Parameter | Mainboard IPO (NSE/BSE) | SME IPO (NSE Emerge/BSE SME) |
|---|---|---|
| Offer document review | SEBI issues observations | Stock exchange grants in-principle approval |
| Profitability test | Average operating profit ₹15 crore over 3 years, or the QIB route | EBITDA of ₹1 crore in 2 of the last 3 years |
| Post-issue paid-up capital | Above ₹10 crore (exchange criteria apply) | Not exceeding ₹25 crore |
| Underwriting | Optional in book-built issues | Mandatory, 100 per cent |
| Financial reporting after listing | Quarterly | Half-yearly |
| Typical issue size | ₹100 crore and above | ₹10 crore to ₹80 crore |
A capital-intensive Gujarat manufacturer with a clean three-year record and an issue size in the ₹10 to ₹80 crore range is usually better suited to the SME route; a larger, established company with higher capital requirements is better positioned for the mainboard. An SME listing can also be a stepping stone, migrating to the mainboard under Regulation 277 once eligibility is met.
4. IPO Readiness: What I Test Before Appointing Anyone
Before any intermediary is approached, a structured readiness assessment should surface every gap that could delay the issue or dent the valuation while the company still controls its own timetable. In an Ahmedabad readiness diagnostic, I test:
- Financial eligibility on a restated, consolidated basis against both the mainboard and SME thresholds.
- Promoter and shareholding structure, including informal cross-holdings between family group entities — common where a manufacturing unit, a trading arm and a property-holding entity sit under one family with overlapping directors — that need to be formalised or unwound before filing.
- Related-party transactions, their arm’s-length basis, and which arrangements should end before listing.
- Customer and input-price concentration, a live issue for textile and chemical manufacturers exposed to cotton, yarn or petrochemical feedstock price movements, and a valuation-discount driver if left unaddressed.
- Litigation, tax, GST and FEMA compliance, including confirmation that neither the company nor its promoters are debarred or wilful defaulters under Regulation 5, and factory-licensing and pollution-control-board compliance for manufacturing units.
- Internal controls and governance, frequently the largest gap in family-run manufacturing groups still working from spreadsheets and manual approvals.
- Capital structure and preliminary valuation, to test whether promoter expectations and the likely market outcome are aligned before drafting begins.
The output is a gap-analysis and remediation plan with named owners and dates — finding these issues before the merchant banker’s billable diligence begins is consistently cheaper than finding them afterwards.
Considering a mainboard or SME listing for your Ahmedabad company in 2026 or 2027?
The readiness diagnostic is where an IPO programme is won or lost. If you would like an independent view on eligibility, the right platform, and the financial and valuation work still to be done, I can walk through your numbers on a short call.
5. The IPO Process, DRHP and RHP
An IPO runs, broadly: readiness assessment and route selection; appointment of the merchant banker and other intermediaries; financial restatement and due diligence; drafting and filing the Draft Red Herring Prospectus (DRHP) with SEBI and the exchanges (or with the exchange alone for an SME issue), which is then hosted for twenty-one days of public comment; SEBI or exchange observations; filing of the Red Herring Prospectus (RHP) with the Registrar of Companies, incorporating those observations, updated financials and the price band; anchor allocation; bidding, which stays open at least three working days; and allotment, with listing and trading commencing on the third working day after issue closure (T+3) under SEBI’s August 2023 circular. From listing day the company is bound by the LODR, Insider Trading and Takeover Regulations.
The DRHP is the draft offer document filed for review; it contains everything except the price and issue dates. The RHP is the version filed before the issue opens, updated for SEBI’s observations, financials not older than six months, and the price band and issue dates. Disclosure quality in both is where liability sits: risk factors must be specific, KPIs must reconcile to audited financials, and the objects of the issue must rest on board-approved estimates.
6. Financial Preparation, Governance and What an IPO Costs
Financial preparation is the most time-consuming part of readiness. It covers restated financial statements for three years plus any stub period on a uniform basis — Gujarat manufacturing groups still reporting under Indian GAAP may need to transition to Ind AS, and a consolidation perimeter split across a manufacturing entity, a trading arm and a property-holding company must be settled first; revenue and margin analysis that isolates the effect of raw-material price movements for textile and chemical businesses; a complete related-party map; a full litigation and contingent-liability inventory; and KPIs computed consistently and certified by the auditor, which must continue to be reported for at least a year after listing.
Governance readiness under the SEBI LODR Regulations means board composition satisfying Regulation 17, the audit, nomination and remuneration, and stakeholders’ relationship committees under Regulations 18 to 21, an insider-trading framework under the 2015 Regulations, and disclosure workflows able to meet the Regulation 30 timelines — best built six to twelve months before filing so new independent directors and committees are already functioning before the merchant banker’s diligence begins.
A realistic timeline is twelve to eighteen months for a mainboard IPO and six to nine months for an SME IPO from the decision to list. Total issue costs commonly run three to seven per cent of issue size for a mainboard listing and eight to fifteen per cent for an SME listing, covering merchant banker fees, legal counsel, audit and restatement, registrar and exchange fees, and marketing. One Gujarat-specific offset is worth checking: the state’s Aatmanirbhar Gujarat Scheme for Assistance to MSMEs, administered by the MSME Commissionerate, includes support towards the expenditure incurred on raising funds through an SME exchange, claimable as a one-time reimbursement after the issue succeeds — the current quantum and eligibility conditions should be confirmed with the Commissionerate before being built into a cost estimate, as scheme terms are revised from time to time. Ahmedabad is also home to SEBI’s own Western Regional Office and to the Registrar of Companies for Gujarat, which is where the RHP and Prospectus of a Gujarat-registered issuer are filed. Separately, an unlisted public Indian company can since January 2024 list its equity shares on India INX or NSE IX at GIFT City, Gandhinagar, under the Direct Listing Scheme — a second venue worth a mention where a promoter wants a foreign-currency capital base, though SEBI’s operating guidelines for already-listed companies remain awaited as at September 2026.
7. Common IPO Readiness Mistakes Ahmedabad Companies Make
- Appointing intermediaries before testing eligibility, wasting cost when a threshold turns out to be unmet on a restated basis.
- Informal arrangements between family group entities — shared premises, unbilled services, undocumented loans — that cannot be justified at arm’s length once a related-party register is compiled.
- Undisclosed raw-material or customer concentration, a recurring issue for textile and chemical manufacturers exposed to a handful of large buyers or a single input.
- Differences between management accounts, audited financials and tax filings, the most common cause of a delayed restatement.
- Missing board resolutions, share-transfer records or factory licences, particularly for units operating out of older GIDC estates, reconstructed under diligence pressure.
- Late appointment of independent directors and hurried committee formation, visible to both investors and exchanges.
- A valuation expectation formed from a family’s own sense of the business’s worth rather than from public-market comparables.
8. IPO Readiness Services From CA Murli Chandak
My IPO work covers the readiness, financial-preparation and valuation phases, and coordination of the wider intermediary group once a company is ready: eligibility and route advisory; a structured readiness diagnostic delivered as a prioritised remediation plan; financial and compliance review ahead of restatement; pre-IPO valuation to anchor the price-band discussion, alongside any Registered Valuer reports needed for pre-IPO allotments or ESOP grants; capital-structure advisory; merchant banker, auditor and counsel coordination; KPI and equity-story support; governance preparation; and post-IPO compliance set-up, with continuing Virtual CFO support where the finance function needs it in the first year as a listed company.
Why Choose CA Murli Chandak
I am a Fellow Chartered Accountant with over 8 years in practice, including a partnership at a Chartered Accountancy firm, and an IBBI-Registered Valuer for Securities or Financial Assets, registration number IBBI/RV/07/2021/14408. My practice has completed more than 300 valuation assignments across more than 7 countries, including the United States, alongside statutory and concurrent audit, due-diligence and forensic work. Specifically relevant to pre-IPO financial preparation: more than 15 purchase price allocations under Ind AS 103, more than 30 impairment tests under Ind AS 36, and debt and equity valuation for more than 10 Indian funds, several defended before Big Four audit teams.
Ahmedabad is where this practice is based, not a market I fly into — readiness meetings, document review and board-level discussions happen in person here as routinely as over video call, with the same approach already in place for Gujarat clients on Registered Valuer, ESOP, Virtual CFO, Transfer Pricing and GST matters.
9. Frequently Asked Questions
Q1. What is the difference between an IPO consultant and a merchant banker?
A: The merchant banker is a SEBI-registered intermediary responsible for due diligence, the offer document and the issue process. The IPO consultant is appointed by the company, works in its interest, and handles readiness, financial preparation, valuation and coordination, before and alongside the merchant banker.
Q2. Can a family-owned Ahmedabad textile or chemical company launch an SME IPO under the current rules?
A: Yes, provided it meets Regulation 229: post-issue paid-up capital not exceeding ₹25 crore and operating profit of at least ₹1 crore in two of the last three financial years, alongside the exchange’s own criteria and the one-year cooling period after any recent conversion or change in promoters.
Q3. Does SEBI approve an IPO?
A: No. SEBI reviews the draft offer document for adequacy of disclosure and issues observations; it does not approve the issue, endorse the company or vet the price.
Q4. How long does an IPO take for an Ahmedabad company?
A: Typically twelve to eighteen months for a mainboard IPO and six to nine months for an SME IPO from the decision to list, depending on readiness. Listing itself occurs on the third working day after the issue closes.
Q5. What does an IPO cost, and is any Gujarat government support available?
A: Broadly, three to seven per cent of issue size for a mainboard IPO and eight to fifteen per cent for an SME IPO. The Aatmanirbhar Gujarat Scheme for Assistance to MSMEs separately supports part of an eligible MSME’s SME-exchange listing expenditure; current terms should be confirmed with the MSME Commissionerate before being relied on in cost planning.
Q6. Can an Ahmedabad company list at GIFT City instead of on the BSE or NSE?
A: An unlisted public Indian company can list its equity shares on India INX or NSE IX at GIFT City under the Direct Listing Scheme notified in January 2024. It is a separate regime from a domestic IPO, and SEBI’s operating guidelines for already-listed companies remain awaited as at September 2026.
Q7. Do we need a Registered Valuer’s report as part of the IPO?
A: The IPO price itself is set through book building. Registered Valuer reports are commonly required for pre-IPO events under the Companies Act — a preferential allotment, an ESOP grant or a group restructuring — and a defensible pre-IPO valuation anchors the price-band discussion with the merchant banker.
Q8. Can an SME-listed company move to the mainboard later?
A: Yes. A company that satisfies the mainboard criteria may migrate under Regulation 277 after the prescribed listing period, with shareholder and exchange approval, without a fresh public issue.
Discuss Your IPO Readiness
If your Ahmedabad company is evaluating a mainboard or SME listing in 2026 or 2027, tell me where you are today — financials, shareholding, governance and growth plan — and I can map out what remains to be done before a merchant banker is appointed.
CA Murli Chandak – FCA | IBBI-Registered Valuer (Securities or Financial Assets) | IBBI/RV/07/2021/14408
Website: murlichandak.com
Phone: +91 99985 39902
Email: murlichandak@murlichandak.com
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This article is intended for general guidance only and does not constitute legal, financial or investment advice. Regulatory positions are stated as at September 2026 and were verified against the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 (as last amended on 21 March 2026), the SEBI (ICDR) (Amendment) Regulations, 2025, SEBI circular SEBI/HO/CFD/TPD1/CIR/P/2023/140 dated 9 August 2023, and NSE Emerge listing criteria. The Ahmedabad Stock Exchange history is drawn from SEBI’s April 2018 exit order and publicly available records. The Aatmanirbhar Gujarat Scheme reference is general; readers should confirm current quantum and eligibility with the Gujarat MSME Commissionerate directly, as guidelines are revised from time to time. Thresholds, timelines and procedures under the SEBI framework should be confirmed with the merchant banker and legal counsel on the date of filing.
Related reading: Registered Valuer in Ahmedabad | ESOP Consultant in Ahmedabad | Virtual CFO in Ahmedabad | Transfer Pricing Consultant in Ahmedabad | GST Consultant in Ahmedabad | Trademark Consultant in Ahmedabad