Over the past few days, three IPO filings by the National Stock Exchange, Jio Platforms, and Zepto with the Securities and Exchange Board of India have sparked curiosity. Jio Platforms is likely to be the biggest in value, followed by NSE and Zepto. Their offer documents provide a wealth of information about their business, the industry they operate in, their finances, and the risk factors associated with investing. For those interested, this is an opportune time to gain insights into businesses you or your friends have used.
The NSE IPO is only an offer for sale by existing investors. That means no money goes to the company. Since it is a steady, profit-making, cash-flow-generating company, it does not need IPO proceeds for future expansion.
Jio Platforms and Zepto are capital-hungry businesses. Telecom and quick-service delivery models require significant capital to get new customers and expand coverage. Jio Platforms is issuing new shares to IPO investors, and since Reliance Industries is the main promoter, it is not selling any shares it already owns. The nature of the offer indicates that the company seeks to maintain adequate balance sheet strength to support future growth.
The story of Zepto is all about the future. The restated losses reported for 2025-26 in the IPO document are significant. However, the company has already raised substantial capital to fund growth. The IPO is a way for existing investors to secure a partial exit while issuing new shares to raise additional capital for expansion. It is a fiercely competitive business, and Zepto is a challenger to incumbents like Swiggy and Zomato(Blinkit). Revenue growth is strong, which should give investors confidence that the company can eventually turn in profits.
The future growth of companies seeking new capital through IPOs matters. As a potential investor, you may want to take a deep dive into the granular data in the prospectus. It is possible for people who are proficient in finance. It is also possible now for those who can use artificial intelligence to make sense of the information. You need to know the information likely to influence these companies' future profit growth. There must be a growing customer base. If that is not possible, revenue per customer must grow consistently for any company to manage its working capital and eventually turn a profit. NSE and Jio Platforms are clocking significant profits, thanks to strong founding shareholders who supported their initial growth. For Zepto, it is a challenge, so the investor takeaway is to focus on the path from growth to profit.
An attractive IPO is one that leaves money on the table for new investors to make eventually. NSE is a steady business that will ensure you receive adequate returns on your investment each year. Jio Platforms is already very large, which makes hypergrowth a challenge. In contrast, Zepto is a nimble consumer tech company growing fast but not yet profitable. However, the potential for hyper-scaling is high at this company, so the takeaway is to weigh stability, scale, and growth before investing.
What can you do
If you are aware of finer details of an IPO document, you may want to read it well. If you are not a finance person, you may want to use AI to help you make sense of the document in simple language. Just like individuals, mutual funds will own these shares after the listing. You may want to continue investing through diversified equity funds and minimise risk in your investment portfolio. IPOs are not a lottery ticket. They are investments that you participate in to benefit from the future growth of businesses. You need to get a handle on some basics to know that. It is not a method to double your money quickly. All forms of equity investing require you to give adequate time to grow. Your understanding of the basics and your temperament determine the success of your future wealth, so the takeaway is to invest with patience and discipline.