With 159.67 crore shares of new-age firms Nykaa, Policybazaar, Paytm and Delhivery due to expire in November, analysts said retail investors should exercise caution when trading the shares.

According to estimates by Moneycontrol, the cumulative value of locked New Age shares due in November is over Rs 87,000 crore at current prices, while the total size of its public offering is around Rs 34,600 crore.

While PE/VC shareholders may want to exit some of their holdings, they are still expected to invest heavily so as not to scare off retail investors. The four stocks have lost an average of 19% over the past month, while the broader Sensex and Nifty indexes have risen more than 4% over the same period.

When Zomato’s lock-in expired in the last week of July, it sparked a selling frenzy as the company’s pre-IPO shareholders, such as Moore, Uber and Tiger Global, dumped huge amounts of stock in the market. As a result, the company’s shares fell 41% in a week. However, some experts believe these new-age stocks will continue to suffer as they struggle to show profits. Therefore, pre-IPO shareholders will find a way out as soon as possible.

Therefore, all eyes are on the largest shareholder who is about to expire. SoftBank has the largest skin in the game as it owns over 10% Policybazaar, 17.5% Paytm and 18.5% Delhivery. It has slowed its investment pace in India this year and cut the valuations of portfolio companies such as Oyo.

Industry insiders believe the Japanese tech investor will soon reduce its majority stake to shore up its returns after posting a net loss of $23 billion in the July quarter and being forced to cut costs. Another thing to note is that the holding period for these stocks has expired. While only about 35% of Nykaa’s shares will go to the public market due to the large stake held by the promoters, others have much higher numbers: 62% for Policybazaar, 86% for Paytm and 82% for Delhivery.

Analysts also pointed out that while Paytm and Policybazaar experienced sharp corrections (down 70% from their IPO prices), others did not drop as much. Nykaa shares are 6% below their IPO price, while Delhivery shares are down 22%.

After Zomato successfully went public in July last year sparked many public questions. They have two things in common – striving to show profits (except for Nykaa, which is almost profitable) and high-end pricing.

In this case, the question is how retail investors should evaluate their bets in these companies. Suppose Paytm has too many problems with its business model in a regulatory environment. In that case, Policybazaar will scare investors as top management is selling shares, Nykaa will be disappointed with profitability, and Delhivery’s growth engine will be poor.