SME platforms exist so that smaller companies can raise capital with lighter disclosure requirements than the mainboard.
Lighter disclosure means less information is available to study, and lower trading volumes can make it harder to sell shares quickly after listing.
An easy example
A mainboard issue may raise Rs 1,200 crore with a lot cost near Rs 15,000. An SME issue may raise Rs 74 crore with a lot cost above Rs 1 lakh.
Important note
SME issues have larger minimum application sizes and their shares often trade in lower volumes after listing.
Common mistake
Applying to an SME IPO without noticing the much higher minimum investment.