Sebi plans to shield small investors from presumably 'risky' IPOs

Certain initial public offers may only be for institutional investors

The Securities and Exchange Board of India (Sebi) is considering the concept of institutional investor-only initial public offerings (IPOs) to shield small investors from presumably risky issues by new-age technology and e-commerce firms. Regulatory and investment banking sources said the regulator is deliberating whether more steps are required to safeguard investors before it allows loss-making companies, such as food delivery company Zomato, to tap the public market.

Banning direct retail participation and mandatory “safety net” are some of the concepts being discussed, said people in the know.

Domestic IPOs, typically, have two broad equal quotas for institutional and non-institutional investors. The non-institutional