Number of IPOs falls as uncertainty prevails
The primary market has seen a lull since the peak of January. From 10 initial public offerings in that month, only three companies hit the capital market in February after the crash in the secondary market.
MUMBAI: The primary market has seen a lull since the peak of January. From 10 initial public offerings in that month, only three companies hit the capital market in February after the crash in the secondary market.
In March, the number of issues was four, and in April again only three companies tapped the market. And only three initial offers--Aishwarya Telecom, Gokul Refoils and Solvent and Anu���s Laboratories--are scheduled in May.
Companies are reluctant to try their luck in the primary market due to lack of clear trend in the domestic market, global uncertainty with oil and food prices at a high, US sub-prime crisis and its after-effects, sudden spurt in domestic inflation, increased volatility, said Suneel Rao, research associate, Arihant Capital Market.
Gradually, however, the sentiment is improving and one might see companies initializing their IPO plans again, Rao said.
Some recent listings have done well for themselves while many are languishing below their issue price.
Sita Shree Foods today closed at Rs 49.80 on BSE, a premium of over 66 per cent to the issue price of Rs 30. The high so far for the stock is Rs 66.50 and low is Rs 30.
Titagarh Wagons ended at Rs 831.60, a premium of 54 per cent to the IPO price of Rs 540. The high till now is Rs 907.90 and low Rs 550.
Kiri Dyes and Chemicals ended at Rs 168 against the offer price of Rs 150. The high for the stock is Rs 204 and low Rs 129.
Gammon Infrastructure's issue price was Rs 167, it listed at Rs 180, today it closed at Rs 169.70. The high is Rs 180 and low Rs 146.45.
Those quoting below their offer prices include Manaksia, Manjushree Extrusions, Precision Pipes & Profiles, Porwal Auto Components, Future Capital Holdings, Cords Cable, KNR Construction, Shriram EPC, Tulsi Extrusions, and V-Guard Industries.
���Investors suffered huge losses due to the poor secondary market performance, which has also taken its toll on the primary markets. Stocks which were priced very high are now ruling much below their offer price,��� Rao added.
Companies that have postponed their IPOs due to weak market conditions are MCX, JSW Energy, ACME Tele, Mahindra Holidays, UTI Asset Management, KSK Energy, he said.
In March, the number of issues was four, and in April again only three companies tapped the market. And only three initial offers--Aishwarya Telecom, Gokul Refoils and Solvent and Anu���s Laboratories--are scheduled in May.
Companies are reluctant to try their luck in the primary market due to lack of clear trend in the domestic market, global uncertainty with oil and food prices at a high, US sub-prime crisis and its after-effects, sudden spurt in domestic inflation, increased volatility, said Suneel Rao, research associate, Arihant Capital Market.
Gradually, however, the sentiment is improving and one might see companies initializing their IPO plans again, Rao said.
Some recent listings have done well for themselves while many are languishing below their issue price.
Sita Shree Foods today closed at Rs 49.80 on BSE, a premium of over 66 per cent to the issue price of Rs 30. The high so far for the stock is Rs 66.50 and low is Rs 30.
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Titagarh Wagons ended at Rs 831.60, a premium of 54 per cent to the IPO price of Rs 540. The high till now is Rs 907.90 and low Rs 550.
Kiri Dyes and Chemicals ended at Rs 168 against the offer price of Rs 150. The high for the stock is Rs 204 and low Rs 129.
Gammon Infrastructure's issue price was Rs 167, it listed at Rs 180, today it closed at Rs 169.70. The high is Rs 180 and low Rs 146.45.
Those quoting below their offer prices include Manaksia, Manjushree Extrusions, Precision Pipes & Profiles, Porwal Auto Components, Future Capital Holdings, Cords Cable, KNR Construction, Shriram EPC, Tulsi Extrusions, and V-Guard Industries.
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���Investors suffered huge losses due to the poor secondary market performance, which has also taken its toll on the primary markets. Stocks which were priced very high are now ruling much below their offer price,��� Rao added.
Companies that have postponed their IPOs due to weak market conditions are MCX, JSW Energy, ACME Tele, Mahindra Holidays, UTI Asset Management, KSK Energy, he said.
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