“Somewhere in the middle of a bull market the first new issues make their appearance.
These are priced, not unattractively, and some large profits are made by the buyers of the
early issues. As the market continues to rise, this brand of financing grows more frequent;
the quality of the companies becomes steadily poorer; the prices asked verge on the
exorbitant. One fairly dependable sign of the approaching end of a bull swing is the fact that
new issues of small and nondescript companies are offered at prices somewhat higher than
the current level for many medium-sized companies with a long market history.”
Even though Graham wrote this couple decades ago, its highly relevant in today’s scenario.
We all are seeing that since March Mid and also in April market is sluggish or has gone sideways and rolling between 14000 to 15000.
But the point to be noted here is - IPOs are not performing well in such kind of markets for Investors as it gets listed at a discounted price. But when the market was in a good mood shooting highs IPOs were performing quite well (in terms of listing gains for investors).
But due to oversubscription, IPOs are performing well for companies as they are selling their shares at a premium price.
Given the fact that retail investors have started investing in the unlisted space, we should also keep a track of those which are having long but visible gestation period: The most awaited candidates being-
Yeah, I also think like that but at the same time, I also think like there are many attractive Startups who will take benefit of IPO and sell their equity and take cash out. But common people will be investing in such IPOs by seeing names and this is will again create IPO euphoria. And many investors are added who want to make quick bucks through listing gains so the cycle will continue I think so.
We all know whenever IPO comes it’s an exit for investors and money is directly gone into their pockets. And nowadays retail investors always run behind listing gains. All IPOs are not bad but most of the IPOs are announced only to make money for investors.
I always believed that if % of OFS is more in public offering rather than fresh issue then that IPO is a way to give an exit for investors.
But in Zomato’s case as the issue is too big and approx. 80% of the money is being used for the company’s growth. But still, I was not comfortable here as Zomato is a loss-making company so I tried googling some reviews and got this one (review link). In this, I learned a new approach to seeing startup IPOs and recognize the motive behind the IPO.
My view - I think I will take my chance to invest in Zomato for 1 or 2 lots and after that wait till the company sees some profits for continuous quarters and then invest accordingly. Also need to read RHP as it will give a clear motive of what Zomato investors are seeking from this IPO.
Ksolves has a good business model ERP is growing at 8percent cage this will help Ksolves to make new highs , the stock is running in circuits and has a lot size of 300 that makes an investment of around 4 lac in a single stock. It’s a big risk and also FOMO. Is anybody there who can assure it’s not pump and dump .
Is Sona Comstar raising an additional Rs. 5250 crores after 42 anchor investors who invested Rs 2500 crores? Sona Comstar’s Rs 5,550 crore IPO subscribed 27% on Day 2 - The Economic Times (indiatimes.com)
Should I understand that this would make it 8050 Crore issue where ultra HNIs invested Rs 2500 crores and rest for public or Rs 3050 crore for public and rest for ultra HNIs?
Explanation appreciated
India Pesticides Ltd. IPO to open on June 23, price band Rs. 290-296. Based on FY21 earnings, offer price is at a P/E of 25 which appears to be reasonable in comparison to industry average.
Why are these specialty chemicals IPO performing so well nowadays?
In the past Chemcon, Rossari Biotech, Laxmi Organic, etc. got a huge subscription from the market. Now Clean Science and Technology is also having great IPO GMP. Any specific reason for their high performance?
How should we approach such (specialty chemical) IPOs? For the long term or just for listing gains?
