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Market Intelligence › Basic Terminologies
Price discovery, liquidity and lock-in — all three are different here
Published by The Retail Trader · AUG 02, 2026 · AIF, PE & Alternates
Buying shares before listing seems attractive because it feels like a chance to get in "early". In that market, three basic things are completely different from the listed market.
First, the price is a negotiated number, not a discovered one. Two dealers can quote completely different prices and neither can be verified.
Second, there is no liquidity. To sell, you have to find a buyer, and one does not turn up at a time of your choosing.
Third, there is less information. Quarterly disclosures, analyst coverage and exchange filings — the level of all three is not like that of a listed company.
Even after listing, you do not get an immediate exit:
• Pre-IPO shareholders often face a lock-in.
• The listing price can come in below your entry price.
• The IPO coming at all is not guaranteed — it can be postponed for years.
• The transfer process and documentation have their own time and risk.
"This IPO is coming" is a sales line, not a timeline. A position in this segment should be one you can forget about for several years, and whose entire loss would not break your plan.
This article is for education only — it is not a buy or sell recommendation, makes no claim of a guaranteed return, and is not advisory. Rules, rates and mechanics are changed from time to time by the exchanges, SEBI and RBI, so verify every number yourself with your broker or the official source.