Shares of Krsnaa Diagnostics, Windlas Biotech and Devyani International declined 3-4 per cent on Monday amid selling by institutional investors.
The 30-day lock-in for anchor investors ended on Monday for these three companies and also Exxaro Tiles. Shares of Exxaro Tiles managed to buck the trend, soaring close to 10 per cent.
All the four stocks had declined 1-3 per cent in the previous trading session.
In the recent past, shares of Zomato, Glenmark Life Sciences and Rolex Rings too had come under pressure around the expiry of the 30-day lock-in period meant for anchor investors.
All four companies made their market debut on August 17. Devyani International ended its debut day with a 37 per cent premium to the issue price. Exxaro Tiles had ended at a 10 per cent premium to its issue price.
Devyani International and Exxaro Tiles are trading 28 and 29 per cent above their issue price, while Windlas Biotech and Krsnaa Diagnostics are trading 20 per cent and 9 per cent below their issue price.
“A lot of these IPOs went through riding on the bull market. Valuations there was no comfort. Some of them were bailed out by anchor investors, so it is natural they sold some stake once their lock-in expired. Retail investors should refrain from IPOs where they cannot find valuation comfort. But if they still go and apply, they should at the max exit within a week of listing. Stretching the investment period at these valuations does not make sense,” said G.Chokkalingam, Founder, Equinomics.
Anchor investors hold close to an 18 per cent stake in Krsnaa Diagnostics. Meanwhile, in the case of Windlas Biotech, they have 12 per cent, 9 per cent stake in Exxaro Tiles and 7.6 per cent stake in Devyani International, as per data provided by Edelweiss.
Shares worth more than Rs 180 crore in Devyani International changed hands on Monday. While the trading volumes in the other three counters was between Rs 20 crore and Rs 40 crore—more than this month’s average.
Anchor investors are institutional investors who are offered shares a day before the initial public offering (IPO) opens. Strong anchor investor interest gives a fillip to the issue as investors across all categories consider anchor allotment before investing.
Anchor investors cannot sell their shares for 30 days from the day of allotment.