Wall Street is betting big on India’s IPO market as retail investors snap up shares. Blackstone President Jon Gray said, “For us, outside of the United States, India is the most liquid market.” Many firms now see huge growth potential in this $4 trillion economy despite challenges like the falling rupee.
Across India’s small towns and bustling cities, retail investors have been snapping up shares of newly listed companies. It’s a boom that Blackstone Inc.’s President Jon Gray celebrates thousands of miles away in his Park Avenue office.
“For us, outside of the United States, India is the most liquid market — the easiest place to get an IPO done in the world this year,’’ Gray said in an interview. India already saw one of its biggest ever initial public offerings in recent weeks and a listing with a market value of more than $100 billion is possible from billionaire Mukesh Ambani’s empire, making the country one of the world’s busiest IPO markets.
Gray and other financial heavyweights acknowledge challenges like rising inflation and the falling rupee. Yet, between its private equity and real estate businesses, Blackstone has listed a string of companies over the past decade in India and revenue growth has been high, Gray said. The firm expects assets under management in the South Asian country to double to $100 billion in the coming years.
That’s a sign of the growing sophistication of the financial markets within this $4 trillion economy as it opens up further to foreign money. It’s also a dramatic turnaround from just a few years ago when private equity investors had limited options to exit investments in India, let alone at substantial profits. Now private equity, private credit and sovereign wealth funds are committing ever deeper pools of capital, while market makers like Citadel Securities LLC and hedge funds like Millennium Management LLC have built a presence there. Other parts of the financial industry are also changing swiftly.
India’s markets remain a fraction of China’s by size. High corporate taxes and the rupee’s decline leave foreign firms smaller profits to repatriate into dollars. On the political front, a youth protest movement is creating new pressures for Prime Minister Narendra Modi’s government.
Wall Street bosses are still looking at the economy’s long-term prospects. Many are betting on a series of measures taken by the Modi administration to jumpstart a vast digital payments ecosystem. Millions of Indians are now putting their savings into financial markets for the first time. As new developments reshape Indian finance, here are some of the biggest changes and challenges emerging:
Banking Boom
In recent months, a string of Wall Street bosses have landed in India to court businesses and the government. Citigroup Inc.’s Jane Fraser had a meeting with Modi. JPMorgan Chase & Co.’s Jamie Dimon met the country’s finance minister. Both firms are working on the IPO of Ambani’s digital services giant Jio Platforms. That company is expected to go public later this year at a valuation that could make it India’s largest ever, Bloomberg News has reported.
Banks have been bolstering teams in investment banking and capital markets. Goldman Sachs Group Inc. has injected at least $500 million into its India banking franchise in recent years, Bloomberg News has reported. It’s also one of the banks on the Jio IPO.
“Rapid financialization of household savings is creating a durable pool of domestic capital to support private-sector investment,” said Sonjoy Chatterjee, chairman and chief executive officer of Goldman Sachs India.
The average fee paid to bankers in India has risen to 1.86% of an IPO’s value, according to capital-markets data provider LSEG. That’s higher than roughly 1.5% in Hong Kong.
The firms are all vying for a larger slice of the pie in what’s become one of the world’s most competitive investment banking markets. The Wall Street banks are competing against each other as well as Japanese ones and local firms like Kotak Mahindra Bank Ltd. and Axis Bank Ltd., who command deep client relationships and pricing power.
Meanwhile, global banks are seeing other opportunities. Citi's India CEO K. Balasubramanian said in an interview that the bank sees added opportunities to do business with local and foreign corporations as India enters into more trade deals with countries including the UK. The India arm of Japan's Mitsubishi UFJ Financial Group Inc. plans to expand its rupee-bond business as companies diversify funding, according to a spokesperson. It has managed about 57 billion rupees ($600 million) of local bonds since the inception of its business in September 2025 and aims to significantly enhance its share over the next two to three years. The firm is also expanding in India’s IPO market.
Private Equity Money
Until the 1990s, India was almost completely closed to foreign capital, and few private equity funds were involved in major deals. As the economy has opened up, PE firms have invested tens of billions of dollars and deal sizes have been increasing.
Brookfield Asset Management Ltd.’s CEO Connor Teskey says that over the next five years the firm’s investment in India will be more than $100 billion from about $30 billion in 2025. It’s a bet on “India’s immense scale, strong economic growth, respect for capital and growing demand for infrastructure,” he said.
Firms like Brookfield and Blackstone are also betting on the country’s real estate markets. Office space has seen a boom as local and foreign companies scramble for room in swanky new towers in cities like Mumbai and New Delhi.
“The one challenge obviously has been higher inflation rates and currency depreciation,” Gray said. Despite that Blackstone has had very good success in areas like its logistics portfolio because “there’s so much underlying demand that you can make up for the fact that the currency’s been going down,” he said.
Global Capability Centers
The basic back-office centers that began in the 1990s have evolved into mission-critical cogs of global finance. India had more than 1,800 Global Capability Centers in 2025 and that is projected to exceed 2,400 by 2030, according to a Dun & Bradstreet report.
While low-end jobs have been shifting to places like the Philippines, the sprawling Indian campuses house armies of quants, risk analysts, investment and tech staff.
GCCs are estimated to have generated around $100 billion in revenue last fiscal year. They have grown so much that some Wall Street giants have more employees in India than anywhere else outside the US. JPMorgan alone has around 60,000 people working at its India GCCs.
Minting Millionaires
Only a small percentage of people in this nation of nearly 1.5 billion people are presently invested in markets, despite recent improvements. Indians save $500 billion annually in financial assets and almost 50% of that is still in cash and deposits, according to analysts at Macquarie.
More of their money may now flow overseas. In recent weeks, India’s market regulator has said it will allow a $463 billion segment of its portfolio management industry catering to wealthy individuals to invest in overseas securities and short equity options.
India’s population of ultra-high-net-worth individuals is forecast to rise from about 19,000 in 2026 to roughly 25,000 by 2031, underscoring its growing role in the global wealth landscape, according to a Knight Frank report. That’s enabled established international private banks like Standard Chartered Plc and HSBC Holdings Plc to build sizeable franchises.
Still, the wealth boom has brought a new set of problems for Modi. As one section of Indian society has grown richer, inequities have deepened and sparked social upheaval. Youth discontent burst into public view this year through the Cockroach Janta Party, a movement that began as satire after a Supreme Court judge compared some unemployed young people to cockroaches. As young people took to the streets this weekend, the authorities imposed unprecedented restrictions in New Delhi, deploying thousands of police and asking telecom operators to suspend internet services near protest areas. Restrictions across dozens of major roads and intersections were in place in the capital on Monday.
Mixed Markets
While longer term investments have poured in, India’s markets have taken a hit this year as the oil importing country’s currency has slumped and inflation has risen with higher crude prices. Foreign portfolio institutions have pulled out about $30 billion from domestic stocks so far this year in pursuit of artificial intelligence opportunities elsewhere.
While India is among the worst-performing equity markets in 2026, its capital markets have deepened and matured rapidly since the pandemic, underpinned partly by sticky domestic flows, the IPO boom and wide-ranging investment opportunities.
Growing liquidity and institutional participation continue to make the country an important destination in global portfolios. High frequency trading desks run by firms like Optiver Holding BV are going head-to-head with newly minted Indian trading joints and are fueling a fight for top talent. At some high frequency firms, interns have begun to command $31,000 in monthly pay in India.
Regulatory Challenges
New dilemmas are emerging for India’s regulators as its markets become more liquid. Indian retail traders lost more than $9 billion trading equity futures and options in the year ended March.
That’s pushed India’s regulators to clamp down on a boom in the options and futures market, one of the most lucrative areas for foreign trading desks.
The regulator recently accused a small Mauritius-based JPMorgan unit of executing manipulative stock trades in India. The offshore unit’s trading ban has since been lifted. Last year, in one of its most dramatic actions on a foreign firm, SEBI accused Jane Street of market manipulation, an allegation that the US financial giant has denied. The firm has pressed ahead with its case in a high-profile appeal against India’s securities regulator.
GIFT City Rises
A new free market oasis called GIFT City is seeing a boom. Gujarat International Finance Tec-City is part of Modi’s push to develop a hub in India that can compete with major international cities. Foreign banks are seeing assets surge in this alternative low-tax center on India’s west coast. There, they are helping set up treasury operations for corporations, offering financing for international businesses and helping foreign clients trade. HSBC has built a $23 billion balance sheet in GIFT city in under six years, according to people familiar with the matter. Citi’s assets there are likely to reach $3 billion by the end of 2026 from about $350 million last December, its India CEO K. Balasubramanian said.
The hub is “central to the internationalization of India’s economy and to building a global financial hub onshore,” he said. “That makes it a big focus for Citi.”