Despite the 10 Initial Public Offerings (IPOs) this fiscal year raising close to Rs 10,000 crore, the sentiment among retail investors towards these offerings has been notably cautious.
According to merchant bankers, while the participation from institutional and high net worth investors has been positive, the interest from retail investors has diminished significantly. On average, the retail portion of these 10 IPOs has been subscribed less than four times.
Although the IPOs have been oversubscribed multiple times, the consensus from various investment recommendations suggesting that the IPOs were overvalued has discouraged retail investors from taking part. Many recommendations warned that the valuations were too high, which contributed to the cautious approach of retail investors.
Mr. Adeel, a retail investor, shared his perspective: "A small-time retail investor will look at investment recommendations and most of the IPOs are said to be overvalued. This will keep us away from those IPOs."