Retail investors get selective about their IPO choices

Mumbai: Retail investors are displaying a more discerning approach in the primary market this year, with fewer fully subscribing to the quota of stocks earmarked for them in a significant number of share listings, according to data compiled by ET. Only 16 out of 42 initial public offerings (IPOs) in 2026 saw retail subscriptions exceeding five times the quota, representing just 38% of issues, a sharp decline from 63% in 2025 and 68% in 2024.

Retail bidders had previously fully subscribed to their allotted quota in all 50 IPOs in 2024 and in 44 out of 49 issues (90%) in 2025. The median of retail bids on IPOs until mid-August has dropped to just 2.32 times the quota in the 42 cases, compared to 17.59 times in 2024 and 8.35 times in 2025. This shift towards selectivity is indicative of a maturing market, according to Arka Mookerji, co-head of the equity capital markets at JSA Advocates & Solicitors.

Companies with robust corporate governance, no significant regulatory issues, and strong growth prospects are attracting more attention compared to unproven business cases. Retail investors are also becoming more selective, considering expected listing gains alongside business quality and valuations. Some of the biggest retail demand this year has come from smaller offerings, with MV Electrosystems seeing its retail portion subscribed 210.59 times, Advit Jewels 92.98 times, and Shree Ram Twistex 72.84 times.