How Accurate Is IPO GMP? We Checked Every Listing Against Reality

Everyone quotes the grey market premium before an IPO. Almost nobody checks it afterwards. So we did.

For every IPO we track, we record the GMP through the bidding window. Once the stock lists, we now capture the actual listing-day price. That lets us ask the question the number is really making a claim about: *when GMP said an IPO would list X% up, how far up did it actually go?*

Here is what our data shows so far. It is a live study — the sample grows every time another IPO lists — but even at this size the pattern is striking, and it is not the one most people assume.

How we measured it

For each listed IPO we compare two numbers:

Both come from our own tracking: GMP recorded live through bidding, listing prices captured on debut. No estimates, no hindsight.

Finding 1: GMP almost always gets the *direction* right

Across every issue in the sample, the last GMP correctly signalled whether the stock would list at a premium or at a discount — bar one issue that GMP called flat and that listed flat. As a yes/no "will this list up?" indicator, GMP earned its reputation.

That is the part GMP does well, and it is genuinely useful: a strongly positive GMP has been a dependable sign that an issue will not list underwater.

Finding 2: on the actual *number*, mainboard and SME are different worlds

This is where it gets interesting. When we measure how far the real listing gain landed from what GMP implied, the two segments barely look like the same indicator.

Mainboard IPOs — GMP was remarkably accurate:

Median miss: 2.8 percentage points. For an unofficial, dealer-quoted number, landing that close to a real listing price is genuinely impressive.

SME IPOs — GMP was all over the place:

Median miss: 20.2 percentage points — over seven times worse than mainboard, and it misses in *both* directions.

Why the split makes sense

It is not random. The SME grey market is far thinner — a handful of trades can set the quote — so it is much easier to move and much noisier. The mainboard grey market is deeper and has real institutional demand behind it by listing day, which anchors the number closer to reality.

Notice the failure modes differ, too:

What this means before you apply

If you want the mechanics behind the number, our guide to [what GMP actually is](/blog/what-is-gmp) covers where it comes from and why it moves.

The honest caveats

This is a small, live sample — a handful of mainboard and SME listings, growing every time another IPO debuts. The direction of the finding (mainboard tight, SME loose) is consistent and has a clear mechanical reason, but the exact medians will shift as the dataset grows. We update this study as new listings come in rather than freezing a single snapshot.

We also measure against the listing-day open. An issue can drift far from there in the days after — GMP was never trying to predict that, and neither are we here.

The short version: grey market premium is a good compass and a poor ruler. It reliably tells you which way an IPO will list. How far — trust it on the mainboard, and take it with a very large pinch of salt on SME.

*Nothing here is investment advice. Grey market premium is an unofficial, unregulated indicator and we are not SEBI-registered analysts. This analysis uses our own tracked data, compares against the listing-day open, and is updated as more IPOs list. Past patterns do not predict future listings.*