Using data from the Indian market, this study compares the investment behavior of domestic (DIIs) and foreign (FIIs) institutional investors in IPOs. We find that while FIIs subscribe to more shares at the time of the offering, DIIs' subscription appears to be more measured and as a result their subscription subsumes that of FIIs in explaining listing returns. In the immediate post-listing period, FIIs reduce their IPO holdings more deeply than DIIs and they do this more in cold than hot IPOs. FIIs adjust their portfolios in the post-IPO period by reducing their holdings in smaller and younger firms, i.e. firms with high stock volatility, and increasing their holdings in stock with higher returns. Overall, our results show that the behavior of FIIs in Indian IPOs is consistent with the view of investors chasing hot markets with hot money.