It said while average IPO sizes have been increasing, direct retail participation has remained flat over the past three years. For large issues, retail subscription levels have been particularly muted.
In a consultation paper published on its website, Sebi proposed that for IPOs exceeding ₹5,000 crore, the retail investor allocation may be reduced to 25% from the current 35%, while the allocation for institutional buyers may be increased from 50% to 60% in a graded manner. It also proposed increasing the number of permissible anchor investor allottees for allocations above ₹250 crore, aiming to ease participation for large foreign portfolio investors managing multiple funds.
Sebi also suggested including insurance companies and pension funds in the reserved category of the anchor investor portion, alongside mutual funds. It proposed raising the reservation for life insurers, pension funds, and domestic mutual funds from 30% to 40% of the anchor investor portion-of which one-third would remain reserved for domestic mutual funds, while 7% would be set aside for insurance companies and pension funds.
