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Where can the money raised be used?
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The use of funds must be specific and supported. In an SME IPO, money kept for general corporate purposes (money not tied to a named use) is capped at 15% of the amount raised or Rs 10 crore, whichever is lower. The money raised cannot be used to repay loans from promoters, the promoter group or related parties.
Proposed, October 2026
SEBI has proposed removing the Rs 10 crore cap and keeping the 15% limit.
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General information, not legal or investment advice. Rules as at 2 November 2026.
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