New Delhi, Aug. 14 -- Foreign portfolio investors (FPIs) dominate anchor investor allotments in larger initial public offerings (IPOs), while alternative investment funds (AIFs), other qualified institutional buyers (QIBs), and body corporates account for a larger share in smaller issues, according to a study by the Securities and Exchange Board of India (SEBI).

Titled 'Study on Exit Behaviour of Anchor Investors in Mainboard IPOs', the study analysed anchor investor behaviour across 242 mainboard IPOs listed between April 2022 and October 2025. For its one-year exit analysis, SEBI examined 167 IPOs that had completed 365 days since listing.

The study found that FPIs accounted for 43.8% of total anchor allotments by value, followed by mutual funds with a 38.4% share. Other QIBs accounted for 10.5%, AIFs for 5.3%, while body corporates accounted for a marginal share.

FPIs dominated larger IPOs, worth Rs 1,000 crore ($104.7 million) or more, receiving 45-47% of anchor allotments by value. On the other hand, AIFs, other QIBs and body corporates accounted for a significant portion in smaller issues. In IPOs worth up to Rs 250 crore, AIFs accounted for 35.2% of anchor allotments by value, while in issues worth Rs 250-500 crore, their share was about 20.4%

Exit behaviour

Anchor investors can exit their holdings in phases: 50% in 30 working days, and the remaining in 90 days. The study found that their exits are gradual and that they hold the majority of their anchor portion even beyond prescribed lock-in windows.

However, they exit early in smaller IPOs, where AIFs are dominant. "The cohort of smallest issues (Rs 0-250 crore) shows the highest exit after 30 days at 9.1%, exit at T+60 (20.3%), and exit after 90 days at 32.4%, substantially higher than all other size categories," the study said.

Body corporates showed the highest intensity followed by AIFs.

AIFs exited 4.4% of their investments in roughly a month's time, 9.9% in two months' time, and 19.6% in three months. Exit rates for AIFs and body corporates were comparable with FPIs despite smaller holdings.

By the end of one year, the largest exits were done by FPIs. They exited approximately 60% of their anchor allotments, the highest in any category. Over the same period, AIFs exited 55%, body corporates 58%, and other QIBs 46%.

Price impact

The analysis found a negative relationship between anchor investor exits and share prices, especially when exit rates were higher than 10% during the first month (first unlock).

If anchor investors were found to be exiting early and at a high intensity, FPIs emerged as the largest sellers. At the first unlock in stocks that saw the highest number of exits (above 10%), FPIs were the largest sellers, exiting 24.5% of their holdings on an average.

While AIFs also showed high exit intensity, their impact on share prices was relatively limited because of their smaller share of overall anchor allocations and their concentration in smaller IPOs.

However, the study did not analyse the price impact of anchor exits across different IPO size categories. Therefore, it remains unclear how AIFs' exit intensity can affect smaller issue sizes.

Published by HT Digital Content Services with permission from VC Circle.