High returns are tempting, but lack of transparency and liquidity make them a high-stakes bet.
The year 2024 was witness to four IPOs – Waaree Energies, Bajaj Housing Finance, KRN Heat Exchanger & Refrigeration and Unimech Aerospace & Manufacturing – wherein the cumulative worth of retail bids was in excess of Rs 10,000 crore each
According to the RBI data, retail investors' trading activity in the secondary market in G-secs stood at Rs 4,267.55 crore as on August 11, 2025, compared to Rs 668.36 crore as on August 12, 2024.
The fungibility element of the current regulatory framework reduce the importance of the size of the retail portion, say experts though they add that under-subscription in retail segment does impact investor sentiment.
As per data from primeinfobase.com, the share of stake held by retail investors in companies listed on NSE went up to 7.53 percent as on June 30 from 7.51 percent as on March 31. In value terms, retail holding stood at Rs 34.25 lakh crore as on June 30.
"In case of large IPOs, the size of the Retail portion increases substantially and requiring significant Retail participation. This is specially challenging in tepid or uncertain markets," stated the SEBI consultation paper.
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While the RBI platform has made G-secs more accessible, retail investors are still far from fully adopting them
After trimming their holdings towards mid- and small-cap stocks in the March quarter, retail investors saw a sharp rise in the share of Nifty 50 stocks in their portfolio.
This is the first time since 2022 that the average retail participation in IPOs has declined in a year. Market experts believe retail investors may now be getting selective, and no longer getting swayed by grey market premiums alone.
Analysts note a shift among retail investors toward safer avenues such as debt mutual funds and fixed deposits amid global uncertainties and rising geopolitical tensions.
Corporate governance reforms, improved risk appetite and dividend strength form the Centre’s pitch. Mutual fund managers remain cautious on valuation gaps and growth concerns.
DIIs emerged as strong buyers, infusing Rs 28,118 crore into equities. FIIs remained net sellers, withdrawing over Rs 8,224 crore during the month.
Over the past five years, investments in mutual funds have grown at a compound annual growth rate (CAGR) of 17.5 percent, while bank deposits have increased at a CAGR of 11.0 percent
Some of the well-known names that saw the retail stake go up were: IDFC First Bank, Aarti Industries, Aditya Birla Fashion, Bandhan Bank, L&T Finance, l&T Technology, IREDA, Mahindra and Mahindra Financial Services, MRF Ltd.
Since the pandemic, domestic institutional investors (DIIs) have not been net sellers on an annual basis. This trend can be attributed to retail investors' influx of funds into mutual funds, primarily through systematic investment plans (SIPs) and direct investments.
The subscription details showed robust institutional demand, with the qualified institutional buyer (QIB) segment bidding for 6.97 times the shares on offer.
October saw a record Rs 60,000 crore inflows from DIIs, offsetting an equivalent amount of equities sold by foreign investors. This also marked the 15th straight month of net buying by DIIs.
Despite having the flexibility to increase their exposure to smaller stocks, Flexi Cap Funds often prefer to concentrate on market heavyweights
Sebi released the study on investor behaviour in Main Board IPOs which analysed data from 144 public issues, and found that "flipping" was highly prevalent among individual investors.
In comparison, the net buying of foreign investors was pegged at around Rs 9,200 crore in August while banks bought shares worth Rs 1,083 crore and insurance companies invested Rs 3,973 crore in Indian equities.
The demand for passive mutual funds has grown exponentially over the past few years and the assets under management in this segment has grown to Rs 10.2 lakh crore or 17 percent of the total market share.
Date from NSE shows that retail investors were net buyers in each of the trading sessions in August so far, except just one day -- 7th -- when they were net sellers at a little over Rs 100 crore. In sharp contrast, FPIs have been net buyers only on only two occasions in the current month -- 1st and 8th -- and ended as net sellers in all other sessions, as per NSDL data.
Non-institutional investors have been the primary drivers in the share markets as a result of their price-insensitive investment approach, as per Kotak.
SEBI’s proposed increase in options contract sizes could significantly impact retail investors by raising trading costs and potentially reducing market participation.