The great IPO Mania – WHAT IS IN IT FOR US?

Like 2006-07, Markets are again flooding with IPOs and we are showing tremendous interest to buy it.

Are we buying because everyone else is buying or we are making a right choice to buy it?

Here are, Some important Facts about Indian IPO

  • Performance of IPOs in October 2010 – out of 13 IPO listed, 8 IPOs are in negative territory.
  • Close to 40 IPOs are filed with SEBI in Last 2 Months.
  • 116 IPOs were listed in between August 2007 to August 2010 – 62% of these IPO are still under their sale price.

Investors think that IPOs are good Investment Vehicle but in reality they arrive in market when promoters are sure that they will fetch good premium.Recently SEBI chairman has requested the merchant bankers not to price IPOs very high, leave some room for the investors!

The question comes in our mind, Should we actually apply for an IPO?

Please follow the below mentioned steps before subscribing to an IPO

  • Take logical decision after detailed analysis.
  • Understand what you are buying.
  • Understand the business.
  • Don’t go by what other are doing.
  • Don`t believe advertisements blindly.

So IPO is an initial public offering or It is Probably Overpriced.

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