In good news for investors and all those who missed IPO allotment, the recent debutants in the equity market, electric-scooter maker Ather Energy and textile start-up Borana Weaves will each see their first post-IPO lock-in periods expire next month. Approximately 6% of equity capital will become eligible for trading.. Investors have the option to sell shares when the one-month lock-in period ends in June.
What is a post-IPO lock-in period?
Post-listing lock-in periods are meant to prevent pre-IPO investors such as founders, employees, and anchor investors from immediately offloading their shares.
Once this period ends, it typically introduces fresh supply into the market.
Ather Energy: Share price down nearly 4% from listing day
Ather Energy, a Bengaluru-based electric scooter maker, listed on May 6 at Rs 328 per share, a modest 2% premium to its IPO price band of Rs 304 to Rs 321. The IPO, which raised Rs 2,981 crore, was subscribed 1.5 times overall, with interest from retail (1.89 times) and QIBs (1.76 times).
According to the listing terms, 21 million shares which is approximately 6% of the company’s equity will become tradable on June 2, marking the first unlock event, added Nuvama institutional equities.
Another batch of 21 million shares is scheduled to unlock on July 31.
Ather Energy, which listed at Rs 328, is currently trading at Rs 315.15, down around 3.91% from its listing price.
Borana Weaves: Share price down 4% from listing day
In contrast, Borana Weaves, a textile manufacturer from Surat, had a decent debut on May 23, listing at Rs 243, a sharp 12.5% premium over its issue price of Rs 216.
The IPO, though smaller in size at Rs 144.9 crore, was subscribed 147.85 times, driven largely by retail investors (200 times).
The upcoming unlock on June 23 will free up about 2 million shares, also around 6% of total equity. A second unlock of similar size is set for August 21.
Borana Weaves listed at Rs 243 and is now trading at Rs 232.30, marking a decline of approximately 4.41% from its listing level.