Online Tool
SME IPO Issue Cost Estimator
Understand the cost of going public before you commit. Enter your planned issue size for an indicative, itemised cost and stage-wise payment schedule.
Estimate Your Issue Cost
Not sure how much you can raise? Try the Issue Size Calculator first.
What does an SME IPO cost in India?
The total cost of an SME IPO works out to roughly 10% of the money raised. The estimator uses an indicative cost structure, with each item as a share of the issue size:
- Selling, marketing and underwriting fees: about 5.29% of the issue size. This is the largest single cost.
- BRLM (lead manager) fees: about 1.43%.
- Advertising and P.R. expenses: about 1.43%.
- Market making fees: about 0.86%.
- Registrar fees, postage and DP charges: about 0.29%.
- Stock exchange fee and other misc. charges: about 0.29%.
- Printing (forms, prospectus, banners, posters): about 0.29%.
- Legal counsel: about 0.14%.
Worked example: a ₹20 crore SME IPO
For a ₹20 crore issue, the indicative total is about ₹2.00 crore (10% of the issue). Selling, marketing and underwriting is about ₹1.06 crore and BRLM fees about ₹28.6 lakh. Around 91% of the total falls due on IPO completion, with the rest spread across mandate signing, DRHP filing, NSE approval and IPO opening.
Actual costs depend on the intermediaries you appoint, how much restructuring and audit work your company needs, and how much you spend on investor marketing. Treat the estimator as a starting point for budgeting, not a quote.
How to keep IPO costs under control
- Get your accounts audited and your compliance up to date before appointing a merchant banker. Clean-up work done under IPO deadlines costs more.
- Compare proposals from more than one lead manager, and check exactly what each fee covers (underwriting, market making, marketing).
- Size the issue to what your business genuinely needs. A small issue still carries most of the fixed costs.
- Use an independent IPO advisor to negotiate with intermediaries and keep the timeline tight.
Frequently asked questions
1.How much does an SME IPO cost?
Roughly 10% of the issue size. For a ₹20 crore issue that is about ₹2.00 crore, of which selling, marketing and underwriting fees are the largest part.
2.What are merchant banker fees for an SME IPO?
In our indicative model, BRLM fees are about 1.43% of the issue size, with selling, marketing and underwriting charged separately at about 5.29%. Compare proposals line by line, as fees may or may not include underwriting and market making.
3.Who pays the IPO expenses?
The company pays them. Issue expenses are disclosed in the offer document under the objects of the issue and are normally met from the IPO proceeds. Where existing shareholders sell shares, they bear their share of the costs.
4.Is market making mandatory for an SME IPO?
Yes. SME issues must have a market maker who provides buy and sell quotes for a set period after listing, so the cost of market making is part of every SME IPO budget.