10.20What is an anchor investor?
1What is it?
Anchor investors are large QIBs who are allotted shares one working day before the IPO opens, at or above the issue price, with a lock-in (50% for 30 days, 50% for 90 days).
2Why does it exist?
They add credibility and demand. Watch the anchor lock-in expiry dates: prices sometimes fall as anchors become free to sell.
3Quick revision
- Big QIBs, one day before opening.
- Lock-in of 30/90 days.
- Expiry can bring selling pressure.
4Knowledge check
Q1. When do anchors get allotment?Show answer
One working day before the issue opens.
Q2. Anchor lock-in periods?Show answer
50% for 30 days, 50% for 90 days.
Q3. Why watch lock-in expiry?Show answer
Anchors may sell, pushing the price down.