30 March 2024 – The expiry of lock-in periods for shares worth Rs 1.48 trillion across 66 companies in the next four months could lead to potential selling pressure, impacting various stocks.
Expiry Overview:
On April 1, shares of companies like Global Surfaces, Sai Silks, JSW Infrastructure, Platinum Industries, and Exicom Technologies will see the end of their lock-in periods.
Market experts anticipate some selling pressure, especially for stocks that haven’t performed well post-IPO. However, stocks with strong performance may not be significantly affected. The lock-in period requirements by SEBI aim to ensure stability in share prices post-IPO and prevent early exits by promoters and institutional investors, particularly in cases of lofty valuations.
Past instances like Zomato’s lock-in period expiry led to intense selling pressure. However, the situation has stabilized amid market corrections and valuation adjustments. The recent years have seen a surge in IPO listings, with some stocks trading below their issue price. Conversely, companies like Indian Renewable Energy Development Agency, Tata Technologies, and Cyient DLM have seen substantial IPO gains.
Conclusion:
The upcoming expiry of lock-in periods for shares worth Rs 1.48 trillion underscores a dynamic market scenario where stock performance post-IPO and regulatory safeguards play critical roles. While some selling pressure is anticipated, market stability and corrections contribute to a nuanced understanding of the impact on stock prices.
