SEBI study: FPIs lead anchor selling amid IPO unlock pressure

When a company wants to sell its shares to the public for the first time, it can first sell some shares to big investors.

These big investors are called anchor investors.

A rule makes them wait a little while before selling those shares.

After the waiting time ends, many of them sell, and this can make the share price drop.

A study from a group in India called SEBI looked at 242 companies that did this.

The study found that foreign investors were the biggest sellers, and smaller companies had more selling.

When many investors sold at once, share prices often dropped by around 3.5 to 6 percent.

The selling did not stop after the first waiting period.

In fact, about half of all anchor shares were sold within one year.

SEBI says this selling pressure is temporary and mostly happens around the first unlock window.