Retail Investors Turn Cautious Towards IPOs

Retail Investors Turn Cautious Towards IPOs

.

Aggressive IPO pricing and poor post-listing performances have made retail investors extremely cautious this year.

.

😦

.

Of the Rs 18,407 crore collected through IPOs, the retail investor portion was subscribed 1.86 times on an average, according to a research report by SMC Capital.

.

Qualified institutional buyers‘ portion was subscribed by 11.42 times and high net worth individuals’ portion by 8.49 times.

.

IPOs this year were subscribed 7.64 times.

.

Of the 19 IPOs, the retail portions of five issues were not even fully subscribed, while five just about managed to get subscribed.

.

Many retail Investors have decided against putting money into recent IPOs after looking at the post-listing performances of stocks that were listed earlier.

.

Only shares of six companies are trading above their issue prices – these include Mahindra Holidays, Oil India and Cox and Kings (India).

.

A lot of investors had saved up, especially for the NHPC IPO.  But when it listed poorly these investor must have suffered hugely.

.

As per the market experts , a lot of the IPOs that came out this year have been highly priced, which has made the already skeptical retail investor stay away from the primary market.

.

Bunch of retail investors are looking at “short-term gains”, so they now prefer to invest their money in the secondary markets rather than in IPOs, market experts feel.

.

If one goes by the DRHPs filed with SEBI, there are approximately Rs 29,000 crore worth of IPOs in the pipeline, said Mr Jagannadham Thunuguntla, Equity Head at SMC Capital.

.

🙂

INFLATION…. “THE SILENT CREEPER”

Hello Friends here we come up with another write up on “SMC Gyan Series”.

🙂

.

INFLATION…. “THE SILENT CREEPER”

.

Topic is INFLATION…. “THE SILENT CREEPER”

.

Here, we would go through the Brief of like what are the impacts of inflation on economy in current scenario and what are the reasons for the inflation?

.

🙂

.

It is an alarming situation when the entire world is fighting with this historical economic crisis.

.

Inflation is adding additional pressure on government as well as consumers.

.

Major contributor of this whopping hike in inflation is food inflation at present context.

Mismatch between demand and supply worldwide created chaos and sent prices of many commodities at multi year highs.

.

According to the latest data, food inflation rose to 17.47 % for the week ended

November 21, 2009 against 15.58 % in the previous week owing to spiraling prices of
vegetables, pulses and sugar.

.

If we talk about overall WPI inflation, it doubled to 1.34 % in October as compared to 0.50 % in the previous month.

.

On year on year basis, food prices jumped by 13.32% in October only.

.

Rice, pulses, sugar and potatoes, onions were up by 13.22%, 22.81%, 45.70%, 96.43% and 37.60% respectively.

.

Reasons for inflation and its impact on economy:

.

•  Bleak monsoon coupled with worst drought in nearly four decades in the country situation is haunting the entire economy.

.

According to an estimate, India may see a drop of 18% in Kharif crop.

It will create further demand and supply mismatch.

People will spend less, if prices will move in the same way and ultimately it will affect most of the sector of economy.

.

•  To encourage farmers to produce more, government has recently increased the MSP (Minimum support Price) of rice, oilseeds, cotton, sugar and many more.

.

Higher MSP immediately pushed the prices up.

Though the long term impact of this step will be positive, as more farmers will produce more to get good remuneration.

.

•  Hoarding by stockist, farmers in anticipation of further hike in prices is also creating a demand supply mismatch, resulting in higher food inflation.

.

•  Government has to compete high with the large scale entry of private players, which procure grains aggressively for biscuits, millers and manufacturers of processed foods.

.

•  Declining trend of public investment in agriculture is another concern for government at present.

.

🙂

.

Next Blog we would try to know about the possible Measures to check inflation.

Stay Tuned for more and more on this 🙂

.

🙂

.

However For More latest Industry,Stock Market and Economy News Updates, Click Here

Controversial Sugarcane Law Gets Parliament Nod

Hello Friends here we come up with the Latest Agri Commodities updates from various parts of the country.

.

Controversial Sugarcane Law Gets Parliament Nod

.

Controversial sugarcane law gets Parliament nod:

.

Parliament today passed a bill that introduces a new sugarcane price regime.

.

This was done after government allayed concerns of Opposition that the states will not be required to pay the difference between the Central and the State Advised Price to farmers.

.

The Rajya Sabha passed the Essential Commodities (Amendment and Validation) Bill which had already been approved by the Lok Sabha last week.

.

Instead of Statutory Minimum Price (SMP) the Central benchmark would be the Fair and Remunerative Price (FRP).

.

The Bill replaces the October 21 Ordinance which had led to protests among sugarcane farmers and political parties against obligation sought to be put on the state governments if they chose to pay higher price than FRP.

.

The new law would also enable the government to pre-empt the sugar industry’s claim of about Rs 14,000 crore on it on account of levy price fixation.

.

🙂

.

In Other major Commodities Updates we can read that Palm oil jumped to the highest level in more than six months after crude oil rose for the first time in 10 day.

.

Palm oil jumps to 6-month high as crude oil ends fall:

.

Palm oil jumped to the highest level in more than six months after crude oil rose for the first time in 10 days, boosting prospects of the vegetable oil being used as a biofuel.

.

Oil snapped the longest decline since 2001 on Tuesday.

As the Federal Reserve said that output at plants, mines and utilities rose 0.8 per cent in November,the fourth increase in five months.

.

Palm oil has surged this year on rising demand from India and China, the biggest consumers.

.

Stockpiles fell 2 per cent to 1.93 million tonnes from a 10-month high in October, the Malaysian Palm Oil Board said December 10.

.

🙂

.

Note : For More Latest Industry, Stock Market and Economy News and Updates, please Click Here