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IPOs in the mainboard typically involve established firms, while SME IPOs present growth prospects but entail higher risks and entry barriers. Investing in SME IPOs provides a distinct chance to participate in a company's expansion, demanding a thorough grasp of the industry and a willingness to tolerate elevated risks.

Mainboard IPOs and SME IPOs exhibit differences across various aspects. Concerning post-issue paid-up capital, Mainboard IPOs call for a minimum of Rs 10 crore, whereas SME IPOs have a more lenient requirement with a minimum of Rs 1 crore and a maximum of Rs 25 crore. The minimum number of allottees in an IPO also differs, with Mainboard IPOs insisting on at least 1000 allottees, while SME IPOs have a lower requirement of 50 allottees.

Another significant difference lies in the IPO underwriting process. Mainboard IPOs involve non-mandatory underwriting, with less than 50% compulsory subscription to Qualified Institutional Buyers (QIBs). Conversely, SME IPOs mandate underwriting, with 100% underwritten by the Merchant Banker, including a 15% underwriting obligation.
Track record requirements are also distinct, with Mainboard IPOs adhering to stringent norms and SME IPOs enjoying relatively relaxed norms. The vetting of the offer document varies as well, with Mainboard IPOs undergoing scrutiny by the Securities and Exchange Board of India (SEBI), while SME IPOs undergo vetting by the Stock Exchange.

The application size for Mainboard IPOs typically falls between Rs 10,000 to Rs 15,000, whereas SME IPOs have a higher minimum application size of Rs 1,00,000. Regarding the IPO timeframe, Mainboard IPOs take approximately 6 months or more, while SME IPOs boast a shorter timeframe ranging from 3 to 4 months. Reporting requirements also differ, with Mainboard IPOs demanding quarterly reporting and SME IPOs necessitating half-yearly reporting. These distinctions underscore the diverse characteristics and regulatory frameworks that govern Mainboard and SME IPOs in the financial landscape.