The feverish pace of listings on India’s primary market has reached a crescendo, and as four high-profile companies stepped onto the public stage, the underwriters and merchant bankers quietly became the biggest short-term winners. In the span of a single week, four new-age companies — Lenskart Solutions, Billionbrains Garage Ventures (parent to the investment platform Groww), PhysicsWallah Limited and Pine Labs Limited — raised a collective ₹21,290 crore through their initial public offerings.
But what grabbed attention was the cost of going public: together, these four companies paid out roughly ₹474 crore in merchant-banking fees alone. That works out to significant sums — Groww alone paid more than ₹151 crore to its bankers. Lenskart followed with about ₹128 crore and Pine Labs about ₹104 crore; PhysicsWallah chipped in around ₹89.8 crore.
When you examine those costs in proportion to the size of the issues, some interesting patterns emerge. Pine Labs’s total offer expenses came to 5 % of its issue size (about ₹194 crore). PhysicsWallah’s spending was about 4.5 % (≈ ₹156 crore), Groww set aside about 4.1 % (≈ ₹270 crore) and Lenskart’s total expenditure was about 3.2 % of its issue size (≈ ₹235 crore).
It isn’t just the raw numbers that matter—these figures shine a spotlight on how the “new-age” tech and digital-first startups are paying a premium to list. Indeed, data from previous listings by companies like Nykaa, Ola Cabs, EaseMyTrip etc. show their IPO expenses ranged from 4 % to as high as 11 % of issue size.
Of course, this trend raises bigger questions. The size and cost of these new listings underscore how India’s startup ecosystem is maturing—but also how expensive the path to public markets has become for founders. If almost half a thousand crores can be funnelled into fees alone, the pressure on the listed entity to perform (and justify the valuation) is that much greater.
For investors, the implication is clear: while the prospect of investing in “next-gen” digital firms is exciting, the associated costs (both visible and implicit) are sizeable. A large portion of the listing expense goes into merchant banking fees—but also into regulatory compliances, listing fees, legal counsel, marketing, printing/ stationery and so forth. According to the article, about 55 % of all IPO expenses across these four companies were directed toward merchant banking.
At the same time, the market’s appetite for new-age IPOs is showing signs of tempering. For instance, following the subscription frenzy of earlier years, the so‐called grey market premium (GMP) on some of these newer companies has weakened considerably, signalling a more cautious investor mood.
In effect, what this all adds up to is a moment of convergence: booming capital markets, deep investor interest in tech/digital startups, elevated valuations—and equally elevated costs of going public. The ₹474 crore figure serves as a vivid metric of how much has to be poured in before a listing even begins to shine in the public gaze.
For founders, bankers and investors alike, the lesson is this: the listing is not just about raising capital, it’s also about infrastructure, compliance, optics and timing—and those things cost real money. As India’s ecosystem evolves and more large tech companies prepare to list, one might expect these expense ratios to be scrutinised more closely, and valuations to be justified with stronger fundamentals.
Reviewed by Aparna Decors
on
November 18, 2025
Rating:
