The ongoing Iran war has sent shockwaves through India's IPO market, which was the world's busiest in 2025, leading several companies to pause their listing plans in 2026 [1]. Global brokerages Nomura and Citi have reduced their 2026 targets for the Nifty 50 index, citing expectations that the conflict will slow India's economic growth and negatively impact corporate earnings [1]. Indian benchmark indices have fallen more than 12% since January, with most of the decline occurring in recent weeks as the Iran war triggers energy and trade supply shocks [1]. Foreign institutional investors have sold over $8 billion worth of equities so far this month, according to data from NSDL [1].
The risk-off environment has drained liquidity from the primary market, making it difficult for IPOs to secure premium valuations. This has led several Indian tech and consumer startups—including Walmart-backed PhonePe, Zepto, Flipkart, and Oyo—to defer their IPO plans due to valuation mismatches and weakened investor appetite [1]. PhonePe confirmed it has temporarily paused its IPO listing due to "the current geopolitical conflicts and market volatility" [1]. Zepto, which confidentially filed for an IPO in December aiming to raise over $1.2 billion, stated it plans to launch an IPO around June, subject to market regulations, but did not clarify its previous advisory [1]. Oyo also filed confidentially for an IPO in December [1].
Large-ticket IPOs, such as those by the National Stock Exchange (NSE), Reliance Jio, and SBI Mutual Fund, are expected to proceed once market conditions improve. Reliance Jio, India's largest telecom company, is planning its IPO for the first half of 2026 and is currently appointing bankers, according to a Reuters report [1]. Experts, including Samir Bahl, CEO of investment banking at Anand Rathi Advisors, emphasized that timing and pricing will require careful calibration in the current environment [1].
Recent poor returns have kept retail and high-net-worth investors away from the market, further reducing the chances of IPOs securing attractive valuations [1]. The rupee's continued slide against the dollar has offered little relief, compounding the challenges faced by companies seeking to go public [1].
CONCLUSION
The Iran war has significantly disrupted India's IPO market, causing major companies to pause or defer their listing plans amid heightened volatility and declining investor appetite. With benchmark indices down over 12% and foreign investors pulling out billions, market conditions remain unfavorable for new listings. Large IPOs may resume once stability returns, but timing and pricing will require careful consideration.