Shares worth $26 billion can soon hit market as IPO lock-ins end

Mumbai: About $26 billion worth of shares across 71 recently listed companies will become eligible for sale between June 17 and September-end as IPO lock-ins expire, according to Nuvama Alternative & Quantitative Research.

The lifting of these lock-ins could create a potential supply overhang for several stocks, said analysts.Of this, shares worth about $15.96 billion across 31 companies that mostly made their stock market debuts in the last six months are slated to become eligible for sale over the next month, said Nuvama Alternative's head Abhilash Pagaria.

The list includes ICICI Prudential AMC, Vishal Mega Mart, Inventurus Knowledge Solutions, Sai Life Sciences, Nephrocare Health Services and Oswal Pumps.The expiry of lock-ins allows promoters, anchor investors and other pre-IPO shareholders to sell their holdings, but need not translate into share sales.

However, the prospect of a sale could weigh on stock prices in the near term.ICICI Prudential AMC accounts for the bulk of the shares set to be unlocked over the next month.

According to Nuvama, shares worth about $11.87 billion, representing nearly 70% of the company's outstanding equity, will become eligible for sale on June 19.Siddarth Bhamre, head of institutional research at Asit C Mehta, said there is some cause for concern ahead of the expiry of IPO lock-ins because mutual fund inflows slowed in May, and cash levels with most funds have declined.

"As a result, any selling may not be fully absorbed by institutional demand and could put pressure on stock prices," he said. ...