Reviewed on 24 Oct 2026 · Source: IPO Bulletin explainer; checked against SEBI ICDR Regulations 2018 (as amended)
A lock-in period is the time after an IPO during which certain shareholders are not allowed to sell their shares. It exists to prevent insiders from selling immediately after listing and leaving new investors with the risk. Under SEBI rules the promoters’ minimum contribution of 20 percent is locked in for 18 months, and the remaining pre-issue promoter shares are generally locked in for six months. Other pre-IPO shareholders, such as venture funds and employees holding shares, are typically locked in for six months from the date of allotment. Anchor investors have their own lock-in: half of the shares allotted to them are locked in for 30 days and the rest for 90 days. Shares allotted to ordinary IPO applicants have no lock-in and can be sold on listing day. When a lock-in expires, a large number of previously restricted shares becomes tradable, and the share price can come under pressure if holders sell. For this reason many investors watch lock-in expiry dates, which are published by the exchanges and by sites like IPO Bulletin. The details of each lock-in are stated in the capital structure section of the offer document.
Example: A stock lists on 1 November. Half of the anchor shares become free to sell on about 1 December (30 days after allotment) and the rest around 1 February. Pre-IPO investors become free around 1 May, six months after listing.
A lock-in period is the time after an IPO during which certain shareholders are not allowed to sell their shares. It exists to prevent insiders from selling immediately after listing and leaving new investors with the risk. Under SEBI rules the promoters' minimum contribution of 20 percent is locked in for 18 months, and the remaining pre-issue promoter shares are generally locked in for six months. Other pre-IPO shareholders, such as venture funds and employees holding shares, are typically locked in for six months from the date of allotment. Anchor investors have their own lock-in: half of the shares allotted to them are locked in for 30 days and the rest for 90 days. Shares allotted to ordinary IPO applicants have no lock-in and can be sold on listing day. When a lock-in expires, a large number of previously restricted shares becomes tradable, and the share price can come under pressure if holders sell. For this reason many investors watch lock-in expiry dates, which are published by the exchanges and by sites like IPO Bulletin. The details of each lock-in are stated in the capital structure section of the offer document.
Allotment is the step after an IPO closes in which the company decides who receives shares and how many. Once bidding ends, the registrar prepares the basis of allotment, which explains how the shares were shared between categories and applicants. If an issue is not oversubscribed in a category, most valid applicants get what they asked for. If it is oversubscribed, shares are rationed. In the retail category, successful applicants are chosen by a computerised lottery and each winner usually receives one lot, because the demand is far larger than the supply. Larger categories receive shares in proportion to their bids. After allotment, shares are credited to the demat accounts of successful applicants, and money for unsuccessful applications is released from the ASBA block. SEBI requires the whole process, from issue close to listing, to be completed within three working days. You can check your allotment status on the registrar's website using your application number, PAN or demat details, and on the exchange page for the issue.
Worked example
A stock lists on 1 November. Half of the anchor shares become free to sell on about 1 December (30 days after allotment) and the rest around 1 February. Pre-IPO investors become free around 1 May, six months after listing.
