Before the banker opens the folder

SME IPO Due Diligence Checklist

What actually gets opened in diligence — not a vanity eligibility spreadsheet.

Review our gaps Eligibility first

Use this as a working list, not a badge

A due diligence checklist is only useful if someone in the company owns each line. Print it, assign names, fix gaps under IPO readiness — then invite the banker.

Financial & reporting

  • Three years of audited financials that reconcile to management MIS
  • Cash flow quality (especially if targeting NSE Emerge)
  • Peer-reviewed auditor comfort; no last-minute auditor shopping
  • Working capital, inventory and receivable ageing that you can defend

Corporate, tax & legal

  • Cap table, convertibles, ESOPs, promoter group map
  • Related-party balances and contracts — full trail, not “we’ll explain later”
  • Tax assessments, notices, ROC filings, material litigation
  • Material contracts, customer concentration, contingent liabilities

Governance & story

  • Board minutes and policies that look used, not decorative
  • Objects of issue that match how cash will actually be used
  • Business description risks that match reality (not brochure copy)

Reporting depth: financial reporting for SME IPO. Board/controls: corporate governance for SMEs. Process order: how to list. Capital clean-up: Pre-IPO advisory.

Diligence FAQ

Straight answers

Is eligibility the same as due diligence?

No. Eligibility gets you into the conversation. Diligence decides if you stay there. Many companies clear capital/profit filters and still fail the first banker data-room review.

Who runs diligence — us or the banker?

The merchant banker and counsel drive the process. You still own the facts. A weak data room slows the DRHP no matter who drafts the Word file.

When should we start building the data room?

As soon as listing is a serious 2–4 year plan. Clean history cannot be backdated. Waiting until “we want to file this year” usually means that year is spent fixing files.