Cornerstone investors which collectively hold about 240 million shares that are not subject to any lock up period could be among the sellers. These investors are big funds and probably sold down their stakes, after AStro’s tepid response on its maiden day of listing. Approved bumiputera investors under the MITI portion, who taken their allocation with financing could also have sold their shares. Some brokerages also provided aggressive financing were also forced sell due to the lackluster performance.

The absence of EPF was a key reason for the underperformance. The EPF usually took up a substantial stake during the book building stage of IPOs. However it failed to come abroad Astro as it felt that the fair value was about rm2.80. If EPF had participated, the fund would have gone to the market to support the shares and average their cost. Other funds normally don’t go to the market when the stock is listed.

Other big funds missing from the book building included LTH and KWAP. They did not subscribe for Astro shares as it as non-syariash compliant. These funds are instrumental in supporting the share price performance of IPOs.

Nevertheless, the EPF might come abroad in the next few days as it is looking to purchase AStro shares at rm2.70 apiece.

Astro offered up to 1.52 billion shares in its IPOs, representing 29.2% of its issued and paid up capital. Under the institutional offering, 597.7 million shares or 11.5% stake were offered to bumiputera investors under MITI’s portion, while 660.7 million shares or a 12.7% stake were offered to selected local and foreign institutional funds.

About 430 million shares or 8.3% stake in Astro were taken up by cornerstone investors portion are not subject to a lock up period while the rest are tied down for a period of three months.