The numbers get worse when two-year and three-year returns are compared with the listing day pop ( see chart).
In other words, the frenzy and hype surrounding IPOs more often than not leads to good trading propositions but not investment ideas.“The big question that investors need to consider is, ‘am I buying at a fair price or not?
Cochin Shipyard Ltd has completed its landmark IPO which was over-subscribed 75 times attracting more than Rs 1.11 lakh crore, as against the offer size of Rs 1,442 crore, the government said today.
Parts of the IPO proceeds will be utilised for expansion projects of the state-run entity.
’” said Nilesh Shah, managing director of Kotak Mahindra Asset Management.“In India, the mistake that retail as well as institutional investors commit is they start looking at grey market premiums and decide on their investment in the IPO,” added Shah.
It could be rigged very easily as it is an unauthorized market,” Shah said.“Then, if the prices go down, they complain of over-pricing.”“IPOs should not be put on a pedestal and expected to perform well and forever,” he added.The top IPO by issue size, Coal India Ltd, which raised nearly Rs15,200 crore in 2010, saw a listing day gain of 39.73%.Link Intime India Private Ltd » Report Link Intime India Private Ltd, C-13 Pannalal Silk Mills Compound, LBS Marg, Bhandup West, Mumbai 400078 Phone: 3838 Fax: 6969 Email: [email protected] Website: FOR the time being i feel you should forget rs 575 for 2 - 3 days as selling is seen at rs 550 , as it went down to 531 and crossed rs 550 , then again down wards from rs 550 now trading at 545 at 11.35 am BSE SELLERS 220382 VS BUYERS 67924 AT 11.38 AM In IPO investments, selling on listing day gives the best returns An analysis of 200 IPOs since 1999 shows 99 stocks had one-year returns that lagged listing day gains, 84 stocks dropped below the IPO share price band Graphic: Ahmed Raza Khan/Mint Ami Shah Mumbai: It may have been prudent to sell most initial public offering (IPO) shares on the listing day rather than holding on to them for longer, a Mint analysis of the top 200 initial share sales by issue size since 1999 shows.Data sourced from primary market tracker Prime Database shows 177 of the top 200 IPOs have completed at least a year since their listing.