Anchor investors in an IPO: who they are, when they bid and the lock-in

Anchor investors are qualified institutional buyers (mutual funds, insurers, foreign portfolio investors, banks, pension funds and alternative investment funds among them) who bid in a separate portion one working day before the issue opens.

• Up to 60% of the institutional portion can be allocated to anchors; one third of the anchor portion is reserved for domestic mutual funds.
• Anchors bid at a price within the band, and pay the difference if the final issue price is higher.
• The company reports the allocation to the exchanges the same day: every anchor, the shares and the amount.
• Half of the shares allotted to anchors are locked in for 30 days from the date of allotment, and the rest for 90 days.

Each IPO page on newboard lists its anchor book from that report, and the lock-in expiry calendar gives the dates for recent issues.