Meesho and Tata Capital Shares Unlock ₹4,500 Crore for Trade

On January 7, 2025, two prominent stocks, e-commerce platform Meesho Ltd. and financial services firm Tata Capital, will see significant trading activity as their shareholder lock-in periods come to a close. A total of 109.9 million shares of Meesho, representing 2% of its outstanding equity, will become eligible for trading today. According to Nuvama Alternative & Quantitative Research, these shares are valued at approximately ₹1,997 crore based on Tuesday’s closing price.

Meesho’s stock performance has been notable, remaining nearly 64% higher than its issue price of ₹111. However, it has experienced a decline of 28% from its post-listing peak of ₹254. The company debuted on the stock market on December 10, 2024, listing at a premium and closing its first trading day at 53% above the IPO price. The three-day IPO, which raised over ₹5,000 crore, attracted strong interest from both institutional and retail investors.

Similarly, Tata Capital will see around 71.2 million shares, also 2% of its outstanding equity, become tradable as its three-month lock-in period ends. These shares, valued at approximately ₹2,573 crore based on Tuesday’s closing price, have recently surpassed their issue price after a steady performance over the last few months, including a gain of over 6% last Friday. Currently trading at an 11% increase from its issue price of ₹326, all seven analysts monitoring Tata Capital have issued a ‘Buy’ rating, with price targets reaching as high as ₹410.

The ₹15,000 crore IPO of Tata Capital was fully subscribed by the end of the bidding process, debuting around its issue price and subsequently maintaining a narrow trading range. The end of lock-in periods is significant, although it does not necessarily imply that all released shares will be sold immediately on the open market.

Other Companies Affected by Lock-In Expiration

In addition to Meesho and Tata Capital, several other recently listed firms will also see their lock-in periods end. Aequs will have 16.7 million shares, or 2% of its outstanding equity, eligible for trading, valued at about ₹230 crore. This stock is currently trading 10% above its IPO price.

Meanwhile, Vidya Wires will see 8.7 million shares, or 4% of its outstanding equity, valued at approximately ₹44 crore, become eligible for trade, though it is currently trading 4% below its issue price. The expiration of lock-in periods can lead to increased volatility in share prices as investors react to the availability of new shares.

Overall, the end of these lock-in periods for Meesho and Tata Capital marks a pivotal moment for investors and could influence trading strategies moving forward.