December 08, 2005

 

Initial?

ICICI Bank's second Initial Public Offer (IPO) was oversubscribed by nine times. Only hitch, in otherwise glowing numbers of overseas over-subscription, is retail portion went under-subscribed - even after giving incentives like 5% discount on offer price and option to pay only in part, instead of usual 100% upfront, with application.


(Chart from finance.yahoo.com. Copyrights with Yahoo.)

Just two years back, ICICI had raised money through IPO. The epitome of earlier story -
Circa 2005.
The general myth that IPO allotment means a winning lottery ticket has been broken multiple times in the current bull run. Let's see if this stock gives a feeling of déjà vu to the investor in coming months.

SEBI had struck down heavily on the practice of mutual funds to use the term IPO for new schemes. Now, they are called New Fund Offer (NFO). Same yardstick should be applied to equity markets and only the first offer from companies be called IPO.

Update:
The chart gets updated every day and shows last performance over last two year. Instead of linking the chart directly, I have uploaded the image on this site and linking that image.

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