Lock-in on ₹5,742 cr anchor investment to expire this month

This month will see the expiration of the anchor lock-in period for 21 IPOs, with a combined investment of approximately ₹11,485 crore. The initial 30-day lock-in window allows for 50% of the anchor allocation to be sold, with the remaining shares becoming unlockable within the subsequent 90 days. According to Geojit Investments, the immediate unlock value is projected at around ₹5,742 crore for this month alone.

Despite market uncertainties, the primary market experienced significant activity in August, with 21 mainboard IPOs raising a total of ₹21,000 crore, the highest monthly deal count of the year. SEBI extended the validity of IPO observation letters until the end of September due to geopolitical tensions from the ongoing war in West Asia.

The Nifty 50 and Sensex indices declined by 1.2% and 1.5%, respectively, in August, marking a shift from the previous two-month winning streak. The staggered lock-in periods, ranging from 30 to 180 days, aim to prevent a single large offload of shares. Recently, Lenskart's lock-in expiration led to the sale of approximately ₹5,650 crore worth of shares through block deals within days.

The rise in primary market activity is expected to continue, with a busier unlock calendar anticipated in the coming six and twelve months. Instead of focusing solely on lock-in expiry and share offloading, investors should prioritize stocks with stretched valuations and minimal float.