Imagine you’re turning 25 next month and you’re also counting on a generous Diwali bonus. Riding high on that expectation, you excitedly tell friends you’re planning a lavish birthday dinner. You start early, picking the venue, finalizing the menu, and drawing up a long guest list.
But then Diwali passes, and the bonus never arrives. Suddenly, the grand plan feels wildly optimistic. You cut corners, cancel invites, and host a much smaller get-together. By the next day, word spreads. Some friends feel snubbed, others gossip about the “big party” that never really happened. It’s awkward, disappointing, and far from how you imagined celebrating.
Now flip the script. This time, you don’t announce anything upfront. You wait until the bonus actually lands in your bank account. Only then do you set a budget, send invites, and host a perfectly planned evening. The party goes off without a hitch, and months later, people still remember it fondly.
There’s no question which version feels better.
And that’s exactly how many companies are approaching IPOs today.
The Rise of the Quiet IPO
A few days ago, Infra.Market, a construction materials marketplace valued at around $2.8 billion, quietly filed its Draft Red Herring Prospectus with SEBI through the confidential, or “pre-filing”, route. Under normal circumstances, a unicorn making an IPO move would dominate headlines. Instead, Infra.Market’s filing barely made a ripple, tucked away in small notices clearly stating that pre-filing does not guarantee an eventual listing.
This isn’t a one-off. Tata Capital’s IPO, also began with a confidential filing. Since SEBI introduced this mechanism in November 2022, 22 companies have chosen this route with 18 filings happening in 2025 alone.
Which raises a natural question: why are so many firms choosing to stay silent before going public?
Avoiding the Noise Before Certainty
The answer lies in control and optionality. Companies want the freedom to explore a listing without committing publicly. Because once an IPO is announced the traditional way, backing out becomes costly.
If a company files a public DRHP and later decides to delay or scrap its IPO, speculation takes over. The media dissects the decision, investors question the business, and doubts linger. That reputational damage doesn’t fade easily and can hurt future fundraising efforts.
Under the traditional route, the DRHP is publicly available for at least 21 days. During this time, investors can comment, analysts scrutinise numbers, and journalists mine it for stories. Once SEBI issues its observations, the company has up to 12 months to launch the IPO, during which the document complete with sensitive business details remains in the public domain.
And that exposure is exactly what many firms want to avoid.
Protecting Competitive Secrets
Take Swiggy as an example. By opting for confidential filing, it prevented rivals from accessing granular data, especially from its quick-commerce arm, Instamart. Pricing strategies, unit economics, customer metrics, and growth assumptions are goldmines for competitors. Making them public before a company is certain about listing is like revealing your playbook mid-game.
There’s also the issue of revisions. SEBI often seeks clarifications or changes to DRHPs, which is a normal part of the process. But when every back and forth plays out publicly, even routine regulatory queries can snowball into damaging headlines.
The recently concluded WeWork India IPO illustrates this risk. Despite being fully subscribed, it faced public scrutiny over alleged inconsistencies in its DRHP and questions around regulatory oversight. When such narratives surface during an active IPO, they can influence investor sentiment, valuations, and post-listing performance.
Why the Confidential Route Appeals
The confidential filing route flips this dynamic. Until SEBI issues its observation letter, the DRHP remains private, shared only with a small group of qualified institutional buyers, sophisticated investors like mutual funds, insurers, and banks.
Once SEBI clears the document, the company gets up to 18 months to launch its IPO, provided it submits an updated DRHP within 16 months. That’s a longer window than the traditional route and gives founders room to manoeuvre.
If market conditions deteriorate due to global tensions, policy uncertainty, or sharp corrections, companies can pause or walk away quietly. No press conferences, no explanations, no reputational fallout. Timing becomes a strategic choice rather than a public commitment.
The Transparency Trade-Off
That said, this approach isn’t without concerns.
The US introduced confidential IPO filings in 2012 to help smaller firms go public without excessive scrutiny. By 2017, the SEC extended it to all companies. Today, nearly 86% of US IPOs begin this way.
But critics have long pointed out a risk: information asymmetry. While retail investors remain in the dark, insiders including company executives, bankers, lawyers, and regulators gain access to sensitive details. History shows that leaks and misuse of insider information aren’t impossible. Even SEC employees have previously been charged with trading on non-public information linked to ongoing investigations.
So while confidentiality reduces public noise, it doesn’t entirely eliminate scrutiny or risk.
Why This Still Matters for India
Despite these concerns, the bigger picture is clear. Confidential pre-filing gives Indian companies confidence. It allows founders to test the waters, fine-tune disclosures, and choose the right moment to go public without the pressure of public expectations.
For India’s capital markets, this could be a net positive. More companies may feel comfortable exploring listings. Better prepared IPOs could mean fewer surprises for investors. And over time, it could strengthen trust in the quality of companies entering the market.
In short, companies are learning the value of waiting for the bonus before sending out the invites. And in a market as sentiment-driven as India’s, that restraint might just make all the difference.