Mumbai: A total of 37 companies' pre-listing shareholder lock-ins are set to conclude in the coming four months, potentially prompting anchor investors to reduce their positions. Many of these firms have seen substantial price surges in the last three months. The ending of these lock-ins could amplify trading volumes, leading to price fluctuations.
Key companies to watch as one-month lock-ins expire include Netweb Tech, with a lock-in on 3% of its outstanding shares ending on August 23; SBFC Finance, with a 3% lock-in ending on September 11; Yatharth Hospital, with a 4% lock-in ending on September 1; and Concord Biotech, with a 3% lock-in concluding on September 13, as per data from Nuvama Institutional Equities.
The Securities and Exchange Board of India (Sebi) requires anchor investors, allocated shares one day before a public offering's commencement, to offload up to 50% of their stake one month post-allotment and the remainder three months afterward. These investors are obligated to commit a minimum of ₹10 crore and can bid for as much as 60% of the quota set aside for qualified institutional buyers during the offering.
“The volumes could run up in certain counters where the pre-listing shareholder lock-in is significant, and where the current market price is substantially higher than the issue price,” according to Abhilash Pagaria, head, Nuvama Alternative & Quantitative Research. “Between August 22, 2023, and December 31, 2023, a total of 37 companies are slated to have their pre-listing shareholder lock-ins lifted.”
Notably, many companies, excluding promoter and private equity stakeholder lock-ins ending one and three months respectively, have seen significant price appreciations. For example, Netweb Tech's share price on August 22 stood at ₹792.50, marking a 58.5% ascent from its issue price of ₹500. Yatharth Hospital's current market price, ₹376.30, is 25% above the issue price, while SBFC Finance's share price has also risen 58.5% from its offering price. Shares of IdeaForge and Utkarsh Small Finance Bank have climbed 50% and 91%, respectively.
Meanwhile, LIC, set to have its pre-listing lock-in lifted after eighteen months on 13 November, is trading at ₹663.9, a 30% dip from its initial listing price of ₹949.
