Greetings,
Before Jan 1, there was euphoria all around. Poeple would look at grey market premium and apply for IPO. I am trying to look at one other perspective. IPO gradings.
Let's see the ratings given by one of the established agencies, ICRA. It's not ICRA. For that matter, you can do similar simple comparisons for scrips graded by CARE / Fitch etc.
The first pick has to be Rel Power, graded 4 but everyone saw what happened to the scrip. Now, just compare it to the opposite say Allied Computers, graded 1 by the same agency but the stock is almost 3 times above it's issue price. Even in today's market, it is up 2%. See more for yourself. Check Ankit Metal & Power ..rated a grade 1 giving 100%+ returns over it's issue price.
One can certainly argue that in those times, market was favorable and it's not fair to compare the issues graded at different times in different market conditions. Let's try to compare the recent 2. J Kumar (rating 2) and Rel Power (rating 4). As checked around 2:30 PM today on MoneyControl, J Kumar is trading at 107, 2.7% below the issue price of 110. Rel Power is trading at 413.50, 8% below it's issue price of 450. 413 price is also because of the news of Bonus shares.
Before Jan 1, there was euphoria all around. Poeple would look at grey market premium and apply for IPO. I am trying to look at one other perspective. IPO gradings.
Let's see the ratings given by one of the established agencies, ICRA. It's not ICRA. For that matter, you can do similar simple comparisons for scrips graded by CARE / Fitch etc.
The first pick has to be Rel Power, graded 4 but everyone saw what happened to the scrip. Now, just compare it to the opposite say Allied Computers, graded 1 by the same agency but the stock is almost 3 times above it's issue price. Even in today's market, it is up 2%. See more for yourself. Check Ankit Metal & Power ..rated a grade 1 giving 100%+ returns over it's issue price.
One can certainly argue that in those times, market was favorable and it's not fair to compare the issues graded at different times in different market conditions. Let's try to compare the recent 2. J Kumar (rating 2) and Rel Power (rating 4). As checked around 2:30 PM today on MoneyControl, J Kumar is trading at 107, 2.7% below the issue price of 110. Rel Power is trading at 413.50, 8% below it's issue price of 450. 413 price is also because of the news of Bonus shares.
Now, a thought comes to my mind is that either all of these grading companies need to be graded or market is doing something fishy. ;-) With my limited knowledge, I am no brainer to judge this.
~ Navjot Singh Sohanpal
2 comments:
:)
Please mention about Mr. S.P. you-know-whos's comments on IPOs and their Performance
I like Mr SP for his fundamental calls. He may have been totally wrong for his IPO calls last year because exuberance was denying fundamentals. So, can't write much.
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