To cool it down before it will overheat. Or to spice it up if it is underwhelming.
Generally underwriters can gauge interest prior to the listing and predict what the price would be, but no-one knows for sure how the IPO would go, so there are safety mechanisms and agreements. Imagine you announce the issue and then bitcoin suddenly drops by -50% and the issue is heavily undersubscribed because of the investors fears. Or, something happens right after the first trading day and/or most people walk away with profits. If it triggers sell off that’s usually when banks should chime in. But they will even if it goes perfectly and prices shoot to the sky. A famous Facebook IPO flop is one example of a first situation.
It’s one thing if it drops from 120 SEK to 80 SEK, and completely different when it’s first spike to 300 SEK and then a free fall to the same 80 SEK levels: psychology-wise, but also in terms of what underwriters can do to soften the situation. If I as a company think long term, as the underwriter client I will desire shares to be spread among a general public, not concentrated in hands of a few players: the more trades there are, the stronger there is a support. One way to do this is allocate small chunks as widely as possible during the actual IPO allocation, but the other component is to let the people trade and exchange, let them mix albeit with some guardrails. But also psychology-wise IPO price is seen as an absolute bottom and price is not expected to go lower than this, if it’s higher by +30% than IPO price you already feel good and likely to keep a share / buy it.