Why mutual funds IPO bets are facing investor scrutiny

Mutual funds invest in IPOs as Qualified Institutional Buyers (QIBs) and anchor investors, securing higher allotment certainty. While no specific restrictions exist beyond SEBI guidelines, fund managers justify IPO investments for diversification and exposure to new models. However, recent criticism targets funds for investing in overpriced IPOs, potentially compromising fiduciary duty and passing on risks to retail investors.