IPO market and Indian investors
In Indian context, the affect of global financial crisis was not that bad. Real estate sector, where prices were at it's peak, witnessed liquidity crunch. Tourism and aviation sectors also witnessed slowdown.
AFTER THE worst financial crisis in 70 years, Indian markets are well in track. It is said that financial meltdown in the US started in December 2007, and continued for one and half years. Now the situation is well under control, thanks to government aids to the economy. Legendary investor described the crisis as one in a lifetime. All major banks and financial institutions in the US collapsed. Millions lost their job around the world. Unrest was seen in Australia. Indian students were attacked. Anarchy took place some parts of the world. This was the result of then recent meltdown. The 'U' curve in the economy took the turn and now it shows signs of steadiness. The worst is almost over.
In Indian context, the affect of global financial crisis was not that bad. Real estate sector, where prices were at it's peak, witnessed liquidity crunch. Tourism and aviation sectors also witnessed slowdown. Techies and financial services executives lost their job. Government came forward with three stimulus packages injected the same into the economy. Now it is believed that Indian economy regained it's health and can compete china. Recently concluded G-20 summit was a milestone in the economic aspect of India. All big economies in the world agreed that India is a giant economic power. India is one of the few markets, which are less affected by the financial crisis.
In India, as part of the financial crisis, Indian stock market plunged and witnessed it's recent lows. January 2008 was a good month for Indian stock market. Both sensex and nifty recorded their all time heights in that month. But in the same month market started collapsing. Then it was said that the plunge in the market was due to profit booking. But the downward trend continued and sensex came down to 7000 range in October 08.
Indian traders were in panic and they sold their stocks and exit from the market. Now secondary market is very active and almost all the losses were settled. During financial crisis, the primary market also was in bad form. Many of the companies postponed their IPO. Some IPOs came in the market but failed to attract investor confidence. As a result IPO market or primary witnessed huge crisis. In 2007 alone, 95 IPOs came and majority of them were great hit because of favourable market conditions. In the year 2008, only 36 IPOs came in the market but failed to collect money. This year, so far 13 IPOs came in to the market. Due to favorable market conditions, recent IPOs of Adani power, NHPC and Oil India were hit.
Adani power, the company owned by Gautam Adani was one major IPO after the financial crisis. The issue was over subscribed by 21 times. It is a fact that after listing the companies didn't shine much except Oil India. On the listing day itself, Oil India's stock price was up by Rs100. Indian IPO market is now active and people are more interested in buying fresh shares. Primary market in India slowly gaining pace and this will be the same in the near future.
On August 24, Bombay stock exchange started IPO index. Which was first of it's kind in India. The index tracks the value of stocks for two years after listing with base date May 3, 2004. Now a days, an Investor can apply for IPO through online. Every broker is offering this facility. It's a cost effective practice and the investor need not pay any fees to apply for the same. Investor can also keep the money in the bank account, which will only be withdrawn after the allotment. These are encouraging factors, which believed to attract the common investor towards IPO market. If secondary market remains good, there will be no obstacle before the primary market also.
In India, as part of the financial crisis, Indian stock market plunged and witnessed it's recent lows. January 2008 was a good month for Indian stock market. Both sensex and nifty recorded their all time heights in that month. But in the same month market started collapsing. Then it was said that the plunge in the market was due to profit booking. But the downward trend continued and sensex came down to 7000 range in October 08.
Indian traders were in panic and they sold their stocks and exit from the market. Now secondary market is very active and almost all the losses were settled. During financial crisis, the primary market also was in bad form. Many of the companies postponed their IPO. Some IPOs came in the market but failed to attract investor confidence. As a result IPO market or primary witnessed huge crisis. In 2007 alone, 95 IPOs came and majority of them were great hit because of favourable market conditions. In the year 2008, only 36 IPOs came in the market but failed to collect money. This year, so far 13 IPOs came in to the market. Due to favorable market conditions, recent IPOs of Adani power, NHPC and Oil India were hit.
Adani power, the company owned by Gautam Adani was one major IPO after the financial crisis. The issue was over subscribed by 21 times. It is a fact that after listing the companies didn't shine much except Oil India. On the listing day itself, Oil India's stock price was up by Rs100. Indian IPO market is now active and people are more interested in buying fresh shares. Primary market in India slowly gaining pace and this will be the same in the near future.
On August 24, Bombay stock exchange started IPO index. Which was first of it's kind in India. The index tracks the value of stocks for two years after listing with base date May 3, 2004. Now a days, an Investor can apply for IPO through online. Every broker is offering this facility. It's a cost effective practice and the investor need not pay any fees to apply for the same. Investor can also keep the money in the bank account, which will only be withdrawn after the allotment. These are encouraging factors, which believed to attract the common investor towards IPO market. If secondary market remains good, there will be no obstacle before the primary market also.
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