Despite recent regulatory scrutiny, the BSE SME IPO index outperformed almost all benchmarks globally in 2024, delivering an impressive 135% return. This remarkable performance eclipsed Bitcoin’s 121% gain and far exceeded the returns of major global equity indices like the Nasdaq (31%), S&P 500 (25%), and Dow Jones (14%). European indices showed mixed results, with Germany’s DAX rising 13% and France’s CAC 40 declining 8%, while Asia saw modest gains, except for South Korea’s Kospi, which dropped 21%.
India’s broader indices, the Sensex and Nifty 50, rose modestly by 6%, while the BSE MidCap and SmallCap indices performed better, gaining 23% and 26%, respectively. Commodities like gold and silver delivered 27% and 19% returns, but still lagged behind the SME IPO index. Other assets, such as platinum (-10%) and crude oil (-4%), fell in value.
Analysts attribute the SME IPO index’s exceptional rally to strong retail participation, oversubscription of IPOs, and enhanced investor confidence driven by regulatory reforms. Stricter criteria have improved governance, ensuring only high-quality SMEs access public funding. This rally also reflects a broader resurgence in investor risk appetite, seen in the strong performance of small-cap stocks and cryptocurrencies.
Mukul Goyal, Co-Founder of Stratefix Consulting, predicts continued growth in the SME IPO segment in 2025, citing increased business interest in public funding. He advises issuers to focus on sustainable growth and fund utilisation to maintain investor trust and deliver long-term value. The outlook remains optimistic, provided both companies and investors stay disciplined in navigating this dynamic market.
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