Private-market liquidity in India does not come through a single exit route. Investors can realise capital through strategic sales, public-market sales, IPOs, secondary transactions and buybacks. As India’s private markets mature, the more important development may be the emergence of multiple liquidity pathways rather than dependence on any one exit window.
TL;DR
Liquidity in private markets refers to an investor’s ability to convert an investment into realised capital.
Unlike listed markets, private assets do not trade continuously on an exchange. Investors therefore typically wait for a specific liquidity event to sell some or all of their ownership.
That event can take several forms: the company can be acquired, it can list publicly, an investor can sell shares after listing, another private investor can purchase the existing stake, or the company itself can buy shares back.
These routes are often grouped together as “exits”, but they do not all work in the same way.
A useful distinction is between company-level liquidity and investor-level liquidity.
A company-level exit changes the status or ownership of the underlying business. Investor-level liquidity can allow one shareholder to exit while the company continues on the same journey.
That distinction is becoming increasingly relevant as India’s private markets deepen.
India’s PE/VC ecosystem recorded $32.9 billion across 257 exits in 2025, up 17% in value from $28.2 billion in 2024. It was the second-highest annual exit value recorded, behind 2021.
But the composition tells a more useful story.
| Exit Route | 2025 Exit Value |
|---|---|
| Strategic Sale | $15.9B |
| Open-market Sale | $9.0B |
| Secondary | $3.9B |
| IPO | $3.9B |
| Buyback | $0.1B |
| Total | $32.9B |
Source: EY-IVCA Private Equity and Venture Capital Trendbook 2026.
No single liquidity mechanism accounted for the entire market.
That matters because different routes become available under different market conditions.
A strategic sale occurs when a portfolio company or an investor’s stake is acquired by another corporate or strategic buyer.
Strategic exits were India’s largest PE/VC liquidity route by value in 2025, reaching $15.9 billion across 82 transactions and representing approximately 48% of total exit value.
Unlike an IPO, a strategic sale does not require receptive public markets. A buyer may be interested because of technology, distribution, market share, capabilities or strategic fit.
For private-market investors, it represents one pathway through which accumulated enterprise value can become realised capital.
An IPO creates a public market for a previously private company, but it does not necessarily mean every existing investor sells immediately.
Some shareholders may sell shares through the IPO itself. Others may continue holding their investment and subsequently sell through the public market, subject to applicable lock-ins and market conditions.
EY separates these into IPO exits and open-market exits. In 2025, each generated $3.9 billion and $9.0 billion respectively.
The distinction is useful.
An IPO creates a liquidity venue. It does not necessarily create liquidity for every shareholder on the same day.
A secondary transaction occurs when an existing private-market investor sells an ownership position to another investor.
Unlike an IPO or acquisition, the underlying company does not need to exit.
The seller could be an early investor seeking to realise returns, a fund approaching the later years of its life, an LP rebalancing its portfolio, or a founder or employee seeking liquidity. Another investor with a different time horizon can acquire the same asset.
India recorded $3.9 billion of PE/VC secondary exits in 2025, according to EY-IVCA.
The significance of secondaries is therefore not simply that they add another exit category.
Secondaries separate the liquidity timeline of the investor from the liquidity timeline of the company.
A company can remain private and continue growing even as ownership moves between investors.
A buyback creates liquidity when the company itself purchases shares from existing shareholders.
Buybacks represented a relatively small share of India’s PE/VC exits in 2025, at approximately $0.1 billion.
Their importance can vary significantly by company, capital structure and circumstances, but conceptually they represent another way in which private ownership can be converted into realised capital without a conventional sale or listing.
Private markets operate across long investment periods. During those periods, public-market conditions, valuations, corporate M&A appetite and investor requirements can all change.
That makes dependence on a single exit route inherently limiting.
India’s 2025 numbers illustrate this clearly. Strategic exits increased sharply while open-market exits declined 30% and secondary exits declined 41%; IPO exit value, meanwhile, increased 18%.
The mix can change from year to year.
And that may be the more important marker of market maturity.
A mature private market is not one in which every investment ends in an IPO. It is one in which capital has multiple credible routes back to investors.
Yes.
The annual numbers can move materially with market conditions. In the first half of 2026, India’s PE/VC exits stood at $9.4 billion, down 29% year-on-year, according to EY-IVCA.
That does not necessarily tell us that the structural liquidity opportunity has weakened. It demonstrates why exit markets are better understood across cycles rather than through a single quarter or year.
India has accumulated a substantial stock of privately held assets over the past decade. Different companies and different investors will reach their liquidity requirements at different times.
The evolution to watch is therefore not simply whether IPO markets are open.
It is whether the ecosystem continues developing multiple ways for ownership and capital to move.
We see private-market liquidity less as a single event and more as an ecosystem of pathways.
An IPO is one pathway. A strategic acquisition is another. A secondary transaction creates a different form of liquidity again.
The distinction matters because companies and investors do not necessarily operate on identical timelines.
As India’s private markets mature, the ability for capital to move between investors without every asset waiting for the same exit window could become increasingly important.
The depth of a private market is ultimately reflected not only in how efficiently capital enters, but also in how many credible ways it can move and eventually return.
This is an observation on the development of India’s private-market ecosystem, not a recommendation of one liquidity route over another. The appropriate outcome for any particular asset depends on its circumstances, stakeholders and prevailing market conditions.
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