The rupee ended at 39.44/45 per dollar, higher than the day's low of 39.48, but losing ground from the previous finish of 39.35/36.
It hit 39.16 in November, its highest in 10 years.
"The outflows from the IPOs were the dominant factor today, but what's remarkable is that the rupee has not fallen further," said a senior dealer with a private bank.
Earlier this month Reliance Power, a unit of Anul Dhirubhai Ambani's group, raised a record $3 billion through an initial share sale that generated sizeable foreign interest, and dealers said rebates worth $2 billion had left India so far.
Dealers said strong inflows into local equities helped trim the rupee's losses.
India's benchmark share index gained over 2 percent, as stocks around the region gained on global acquisition news.
The euro and the dollar edged up against the yen on Monday as stocks rose, signalling an improvement in risk appetite, but investors were seen holding their fire before a batch of central bank meetings this week.
With the Reserve Bank of India widely seen as playing an active role in limiting the rupee, dealers were circumspect about building large positions in the local unit.
The central bank bought $72.1 billion in the first 11 months of 2007 and dealers said it has been active since then in a bid to prevent the rupee from appreciating rapidly.
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