Now it?s the retail investors who are calling the shots in the primary market. With qualified institutional buyers (QIBs) shying away from the primary markets during the past two months, most of the recent primary market offerings were bailed out by overwhelming participation from retail investors.

Despite their QIB portion remaining heavily under-subscribed, the initial public offerings (IPO) from companies like Readymade Steels, Rushil Decor, Timbor Home, VMS Industries and Aanjaneya Lifecare among others managed to sail through with their retail portion getting subscribed multiple times.

?Though it?s little surprising, the trend shows that retail investors have liquid cash at their disposal and are trying to invest in whatever opportunities they are seeing. Even the recent R1,000-crore NCD issued by Shriram Transport Finance received good response from retail investors,? said Mayank Shah, CEO, Anagram Stock Broking.

According to Prithvi Haldea, MD, Prime Database, most of the retail investors who participated in the recent IPOs have a regional flavour. ?They have either the first-hand knowledge of the company or are based out of those areas in which these companies have their main business operations. However, the high net worth investors in the recent public offerings largely comprised those individuals with whom issuers and bankers had prior tie up with,? said Haldea.

Despite retail money coming in, the subdued participation from the QIB portion is worrying issuers and merchant bankers.

The R8,000 crore follow on public offer (FPO) from SAIL, which was expected to hit the market in mid June has been deferred due to adverse market conditions. Recently, the R200 crore IPO of Galaxy Surfactants with IPO grade 4 indicating ?above average fundamentals? was withdrawn owing to poor investor response. The issue was subscribed just 0.30 times with the portion reserved for QIB category being subscribed to the extent of just 59%.

In the current month, ONGC is expected to file its red herring prospectus for its R11,500 crore FPO.

?Normally most of the QIB’s make their investment decision based on pricing, valuation, fundamentals and track record of the company. But now they are also considering the broader economic scenario before making an investment decision. With rising inflation expected to hit growth and consumption, a little bit of pessimism has crept in,? said a senior executive at a leading merchant bank who do not wanted to be named.