Sula Vineyards shares tumble as 90-day mandatory IPO lock-in period ends

Shares of Sula Vineyards – a leading wine manufacturer – were in the red during Monday’s trading session. Sula Vineyard’s stock tumbled to as low as Rs 335.45 apiece, down over 4 per cent on the BSE from Friday's closing as the anchor investors' mandatory 90-day lock-in period ends today.

Sula Vineyards launched the initial public offer between December 12-14, 2022. The shares of the winemaker were listed at Rs 358 apiece against the issue price of Rs 357 a share on December 22, 2022.

Who are Sula Vineyards' anchor investors?

Sula Vineyards raised Rs 288 crore from anchor investors days ahead of its initial share sale on December 9, 2022. It alloted 80,70,158 equity shares to anchor investors at Rs 357 apiece, aggregating to Rs 288.10 crore, according to a circular uploaded on the BSE website.

The capital was raised from 22 investors, including BNP Paribas Arbitrage, Morgan Stanley (Asia) Singapore Pte Ltd, Citigroup Global Markets Mauritius Pvt Ltd, Goldman Sachs and Abu Dhabi Investment Authority.

ICICI Prudential Life Insurance Company, HDFC Life Insurance Company, Aditya Birla Life Insurance Company, Max Life Insurance Company, Aditya Birla Sun Life Mutual Fund (MF), SBI MF and HDFC MF were also among the anchor investors.

What is the 90-day lock-in period?

The lock-in period is the time until the end of which investors (including promoters, employees, and early investors) of a company that released its IPO, must hold their shares, regardless of the price in the market.

Earlier in December 2021, the Securities and Exchange Board of India (SEBI) decided to extend the lock-in period for anchor investors to 90 days. It cleared changes to regulations pertaining to the issue of capital and disclosure requirements and tightened rules for IPO proceed utilisation.

Sula Vineyards share price history

Sula Vineyards' share price has gained nearly 2 per cent since its market debut and has surged marginally by 2.5 per cent year-to-date.

Anil Singhvi’s view on Sula Vineyards

Zee Business Managing Editor Anil Singhvi had recommended to buy shares of Sula Vineyards with a long-term view. Long-term investors can buy on significant declines as the growth potential remains immense in this stock, he added.

Sula Vineyards Limited is India’s largest wine producer and seller as of March 31, 2022. It has been a consistent market leader in the Indian wine industry in terms of sales volume and value since fiscal 2009 crossing 50 per cent market share by value in the domestic 100 per cent.

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