The Rise of Pre-IPO Deals and Private Equity: How NRIs Can Participate in India’s Next Big Wealth Cycle

India is entering a transformative phase of economic growth; one that’s producing new avenues to wealth beyond the traditional stock market. With record levels of private capital, more interest in IPOs, and easier opportunities for international players to participate — the pre-IPO and private equity markets are booming.

For Non-Resident Indians (NRIs), this is a unique time that offers an opportunity to invest in India’s next set of high-growth companies, before they hit the public markets. The question is no longer of why they chooses, or will choose in the future to do so — but this: how NRIs could get a stake effectively while managing risk and regulations.

According to the Bain & Company “India Private Equity / VC Report 2025”, investments in the PE-VC space in India grew by approximately 9% to ~US$43 billion in 2024, driven entirely by growth- and VC-stage funding.  The number of deals increased substantially — e.g., from 880 in 2023 to 1,270 in 2024 for VC deals.  Meanwhile, the EY-IVCA report noted that in August 2025 alone, PE/VC investments in India reached US$2.8 billion across 115 deals. 

Pre-IPO rounds gaining significance

India’s dynamic economy is providing opportunities well beyond the listed markets. Pre-IPO and private equity segments are increasingly being identified as offering strong potential for NRIs. Here are some pros and cons:

Investment opportunities: These private investments give access to companies before they go public, often at lower valuations, and in turn can generate sizable long-term gains.

With India’s increasing GDP, predictable policy environment and business-friendly reforms in place, private market investment is now an essential component of investing to grow wealth — especially for NRIs looking to diversify beyond public equities and real estate.

Deeper Look at Pre-IPO and Private Equity Investing

Private Equity (PE)

Private equity is the process of investing in privately held companies and scaling and improving them before going public or getting sold. It covers different categories:

• Venture capital for startups
  
  

• Growth equity for expanding firms
  
  

• Leveraged buyouts (LBOs) for established businesses
  
  

These types of investments are generally overseen by professional firms or institutional funds collecting money from investors. The goal is to identify underperforming or high-potential companies, improve their operations and prepare them for long-term value creation.

Pre-IPO Deals

Investors can snap up shares of a company before it goes public through pre-I.P.O. transactions — often at a discount to the anticipated listing price. For decades, such deals were only available to the largest of institutions and ultra-high-net-worth investors. But today, digital platforms and regulatory changes have paved the way for participation by NRIs and smaller investors.

Pre-IPO shares generally have a lock-in period of six months post-listing to ensure stability in the market. While there’s a waiting period, the draw is the potential upside: The IPO on Zomato yielded early backers an annualized return of more than 140% from its listing after less than a year.

Performance and Track Record

Private equity in India has long returned better than public market benchmarks. India’s SME exchange, for instance, has given 18–25% returns every year in the last five years.

Players such as Steptrade Capital, which focus on SME-oriented Alternative Investment Funds (AIF), have made over 22 pre-IPO and 50 anchor investments, overseeing ₹300+ crore across 100 companies. Although opportunities have become more competitive, diluting outsized returns, the asset class still offers strong relative performance over time.

How NRIs can invest in private markets

​

1. Alternative Investment Funds (AIFs)
   AIFs are one of the more regulated routes for NRIs to invest in pre-IPO and private equity deals. They offer professional management, diversification and SEBI-regulated compliance. Most minimum investments start at ₹1 crore.
   
   

2. Portfolio Management Services (PMS)
   PMS platforms provide customised investment portfolios, and many of them have access to pre-IPO shares through their networks. SEBI mandates a minimum investment of ₹50 lakh and up to 25% of PMS capital may be invested in unlisted shares.
   
   

3. Direct Investments
   Some NRIs want to invest in startup rounds directly. This is also possible but requires an immense amount of due diligence, legal knowledge and risk appetite. Many start with smaller amounts via vetted online platforms before scaling up.
   
   

4. Secondary Markets
   Secondaries offer the opportunity to invest in pre-IPO shares from existing shareholders ahead of a company’s public market listing, providing flexibility and early access to potential high-flyers.
   
   

5. GIFT City Advantage
   The Gujarat International Finance Tec-City (GIFT City) is fast emerging as an attractive destination for NRI investment. With relaxed rules, tax incentives and greater ease in transferring funds, it's quickly becoming the preferred launchpad to invest in India's capital markets such as private equity and pre-IPO offerings.

​

The Bottom Line

India’s private equity and pre-IPO markets are in a stage of tremendous growth. For NRIs, it is more than just a trend — but a chance to be part of the next big wealth cycle in the country.

By conducting smart research, staying diversified, and taking a long-term view, NRIs can unlock meaningful returns and join India’s economic resurgence — not as observers, but as active participants.