HUGE Share Unlocking Incoming! Orkla India, Amanta Healthcare, Prostarm Info Systems Lock-ins Expire – What Happens Next?

Upcoming Share Unlocks

Shareholder lock-in periods for several Indian companies are nearing their expiry dates, which could lead to a significant increase in the number of shares available for trading. This event is closely monitored by investors for its potential impact on stock prices.

• Orkla India is set to have its one-month lock-in period expire on Wednesday, December 3. This will make approximately 34 lakh shares, representing about 2% of its outstanding equity, eligible for trading. At current market valuations, these shares are worth nearly ₹211 crore.
• Amanta Healthcare will also see its three-month lock-in period conclude on December 3. This will free up 15 lakh shares, which constitute 4% of the company's total equity. Based on the latest market price, these tradable shares are valued at approximately ₹16 crore.
• Following closely, Prostarm Info Systems will experience the expiry of its six-month shareholder lock-in on Friday, December 5. This event is particularly noteworthy as it will release a substantial 3.1 crore shares, accounting for nearly 53% of its outstanding equity, into the tradable pool. The value of these unlocked shares is estimated at around ₹630 crore.

Market Implications

The expiration of lock-in periods introduces a new supply of shares into the market. While this does not guarantee immediate selling, it provides shareholders with the option to trade their holdings.

• The large percentage of equity being unlocked by Prostarm Info Systems (53%) could potentially exert more significant pressure on its stock price compared to Orkla India or Amanta Healthcare, where the percentages are smaller.
• Investor sentiment and overall market demand will play crucial roles in determining the actual impact on stock prices. If demand is strong, the increased supply may be absorbed without major price drops. Conversely, if selling pressure is high and demand is weak, stock prices could face downward adjustments.

Important Note for Investors

It is crucial for investors to understand that the end of a lock-in period simply means shares become tradable. It does not automatically mean that all shareholders will sell their stakes.

• Investors should closely monitor trading volumes and price movements for these companies in the days following the lock-in expiry.
• The timing and volume of sales by the newly eligible shareholders will be key factors influencing market dynamics.

Impact

• The share prices of Amanta Healthcare and Prostarm Info Systems are likely to experience volatility due to the significant increase in tradable shares. Orkla India may also see some impact depending on its specific market structure.
• The overall market might see minor ripple effects if these unlocks lead to substantial trading activity or significant price movements in these specific stocks.
• Impact Rating: 6/10

Difficult Terms Explained

• Shareholder Lock-in Period: A period during which shareholders are restricted from selling their shares, often imposed on early investors or promoters after an IPO.
• Outstanding Equity: The total number of a company's shares that are held by all its shareholders, including share blocks in the hands of financial operators, and the general public.
• Tradable Pool: The quantity of shares of a company that are available for buying and selling in the open market.