Unlisted & Pre‑IPO Shares

Unlisted shares offer early exposure to potential future listings, but information asymmetry and liquidity risks are high.

Pricing can be opaque, settlement can take time, and exits may depend on IPO windows or OTC buyers.

Treat as high‑risk, small allocation only; verify broker credibility and maintain complete documentation.

Opaque pricingPaperworkLiquidity risk

Ways to Invest

  • Through registered brokers/marketplaces dealing in ESOP/secondary unlisted shares.
  • Via PMS/AIF schemes that allocate to unlisted/pre‑IPO.
  • ESOP purchases from employees (ensure approvals/ROFR terms).

Key Checks

  • Company disclosures, financials, audit quality, ROC filings.
  • Contract notes, DP transfers, share certificates/ISIN, timelines.
  • Exit paths: listing plan, buyback policy, or grey‑market liquidity.
  • Tax: capital gains as per unlisted equity rules.

Why Unlisted / Pre-IPO Shares Are High Risk

Illiquidity, opaque price discovery, and settlement risks

  • Illiquidity: No exchange order book; exits depend on finding a counterparty. Spreads can be very wide.
  • Opaque pricing: Quotes vary by dealer; last-traded references are informal and can be stale.
  • Settlement risk: Off-market DP transfers (DIS/e-DIS) require trust in the counterparty / dealer process.
  • Documentation risk: Wrong ISIN, ineligible folios, or transfer rejections can delay or void trades.
  • Corporate actions: Delays or miss-outs possible if KYC/DP details aren’t perfect at record dates.
  • Lock-ins & listing uncertainty: Company may never list; even if it does, pre-IPO holdings can be under post-IPO lock-in.
  • Disclosure quality: No quarterly public filings like listed firms; limited audited information.
  • Tax: Unlisted equity STCG taxed at slab; LTCG usually 20% with indexation (holding ≥24 months). Tax rules can change.
  • No exchange grievance redressal: Disputes are bilateral (you vs dealer/counterparty).
Bottom line: Treat unlisted equity as a high-risk, illiquid satellite allocation. Use only surplus capital; verify ISIN, seller title, and transfer method before paying.

Where to Buy Unlisted / Pre-IPO Shares (India)

Dealer-led platforms & brokers (OTC). Do your own due diligence.

Platform / Broker Type Focus / Notes
UnlistedZone Dealer Platform Large catalogue of pre-IPO/unlisted; quotes & research notes
Altius Investech Dealer / Desk Pre-IPO, ESOP blocks; concierge settlement support
TradeUnlisted Dealer Platform Sourcing from employees/early investors; negotiated blocks
Planify Dealer Platform Research coverage; start-up & pre-IPO allocations
Stockify Dealer Platform Retail access; indicative quotes & RFQ model
Sharescart / similar desks Dealer / Aggregator Catalogue-driven; pricing via dealer network

How transactions typically work

  1. KYC & DP details: Share PAN, address, and DP (NSDL/CDSL) details for contract note.
  2. Deal confirmation: Lock price/qty and confirm ISIN; ask for company’s latest cap-table/eligibility.
  3. Funds & escrow: Reputed desks use escrow/TPA; avoid direct transfers without safeguards.
  4. Off-market transfer: Seller initiates DP off-market transfer (DIS/e-DIS) to your demat against contract.
  5. Verify credit: Check demat statement for correct ISIN/quantity before releasing funds (or as per escrow terms).
  6. Keep documents: Contract note, invoice, transfer proofs for tax and corporate actions.
Important: These are OTC intermediaries, not stock exchanges. Availability, pricing and settlement practices differ by desk. Always verify the ISIN and transfer method with your DP before paying.

Education only; not investment advice. Markets carry risk; do independent due diligence.