War & Volatility: Why India’s Multi-Billion Dollar IPO Engine Has Stalled

The momentum of India’s primary markets has hit a geopolitical wall, as the escalating conflict involving Israel, the U.S., and Iran triggers a massive retreat from the world’s most active listing venue.

In a reversal from the record-breaking activity seen in early 2026, over 160 Indian companies holding SEBI approvals for roughly ₹1.6 lakh crore ($17.2 billion) have hit the pause button. The volatility, driven by Brent crude surging past $100 a barrel, has evaporated the valuation premium that domestic and international investors were previously willing to pay for Indian equities.

The most high-profile casualty of the current instability is the Walmart-backed fintech leader PhonePe. The company has put its $1.3 billion public issue on hold, despite an internal target valuation of $9–10 billion. The pause is a part of a broader trend of timing sensitivity, where even dominant market players are unwilling to risk a flat or discounted debut.

The retreat is already visible in regulatory filings. Rays Power Infra and Arjun Jewellers have formally withdrawn their Draft Red Herring Prospectus (DRHP) documents this month. This exodus from the IPO waiting room marks the sharpest contraction in listing intent since the 2022 global inflation shock. Moneyview, the credit-led fintech has joined the list of major startups reconsidering their listing timelines.

A Cyclical Reset

Market veteran Krishna Patwari, Founder and Managing Director of Wealth Wisdom India Pvt Ltd (WWIPL), notes that this cooling period was inevitable given the risk environment.

"In such uncertain conditions, especially amid escalating geopolitical tensions, IPOs are often among the first to be deferred. We are already seeing this play out, with companies like Rays Power Infra and Arjun Jewellers withdrawing their IPO plans, while fintech major PhonePe has reportedly paused its listing at an expected valuation of $9–10 billion," Patwari said. He emphasized that the current freeze is driven by sentiment rather than fundamental failure. "Additionally, a few other companies across sectors have either delayed or are reconsidering their IPO timelines in the current environment, which have previously shown signs of timing sensitivity depending on market conditions and investor sentiment. However, this phase should be seen as cyclical rather than structural," he added.

Earnings Pressure and the Q4 Horizon

The secondary market’s 7% decline since the start of the conflict has left many ready-to-list companies worried about their Q4 earnings profiles. Rising energy costs and supply chain bottlenecks are expected to squeeze margins across the manufacturing and logistics sectors.

"The upcoming April–June quarter could turn out to be one of the weakest quarters for corporate earnings, as businesses continue to navigate global uncertainty, cost pressures, and demand fluctuations. This may further keep primary market activity subdued in the near term," Patwari warned.

However, the pipeline remains fundamentally robust. Experts suggest that once the geopolitical "shock" is absorbed, the sheer volume of pending capital will force the window open again. "As geopolitical tensions ease and market stability gradually returns, liquidity is expected to improve and investor confidence to rebuild. We believe that the IPO window may gradually reopen towards the latter part of the third quarter and more strongly in the final quarter of the financial year 2026-27. This phase is likely to witness better participation, improved liquidity, and more balanced valuations, creating a healthier and more sustainable environment for new listings," Patwari concluded.

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