IPOs in India
Anchor Investors and Lock-ins
Big institutions may be allotted shares a day before the IPO opens, signalling confidence, and existing shareholders face lock-ins to avoid immediate selling.
Rules aim to steady the market.
Anchors
Selected institutions commit money the day before the issue and their shares are locked for a period.
Promoter lock-in
Promoters must hold a minimum share for a specified time after listing.
Pre-IPO investors
Early investors face shorter lock-ins.
Lock-in expiry
When lock-ins end, selling can add pressure on the share price.
A lock-in date
A share price dips when a large batch of early investors becomes free to sell.
Ignoring lock-in expiries
They can move prices.
Key takeaways
- Anchors invest before the issue.
- Promoters are locked in.
- Early investors have lock-ins.
- Expiry can pressure prices.
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