Posts Tagged ‘Oil India’

Are Retail Investors Staging a Comeback in Country’s Primary Market ?

Are Retail Investors Staging a Comeback in Country's Primary Market ?

Are Retail Investors Staging a Comeback in Country's Primary Market ?

In what could be viewed as a sign of revival of retail interest in the country’s primary market, the initial public offering of Indiabulls Power has received over 31,000 applications from retail investors on the first day of its issue.

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Although the retail portion of the offering remained under subscribed, the interest was more than what was seen in three major IPOs of the fiscal — NHPC, Oil India and Adani Power.

According to an analysis, NHPC‘s over Rs 6,000 crore issue received 30,474 retail applications on the first day.

Adani Power‘s Rs 3,610 crore issue got only 15,000 such applications.

The Rs 4,982 crore issue of OIL received 7,700 applications.

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“Retail investors are gradually staging a comeback and it is a pleasant surprise for the primary market,” SMC Capital Equity Head Jagannadham Thunuguntla said.

The Rs 1,700-crore initial public offer of Indiabulls Power, which hit the market yesterday, got subscribed nearly six times, as flooded the counter with maximum number of bids.

However, bids from retail investors on the first day of subscription accounted for only 37 per cent of the shares reserved for them.

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Oil rises above $70 as markets stabilize!

Oil prices

Oil prices rose slightly above $70 a barrel, recovering only some of the losses suffered on Monday, when investors worried about the economic outlook of China while by late afternoon European time in electronic trading on the New York Mercantile Exchange, the standard crude for October delivery was up 18 cents at $70.14 a barrel.

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However, the contract slumped $2.78 on Monday to settle at $69.96 after a drop in stocks heightened investor concerns that the global economic revival may be weaker than anticipated.

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Whereas China’s standard stock index fell 6.7% Monday while the Dow Jones industrial average fell 0.5%.

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Moreover, most Asian stock indexes rose modestly on Tuesday, including China’s.

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Although European markets were down while it is said that stocks are a leading indicator of the economy, so if there is a slump in stocks, that”s one fewer driver to support high oil prices.

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Additionally, oil will likely trade between $65 and $70 during the next few weeks and a big pullback is expected because they are starting to see more signs of economic life.

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However, in other Nymex trading, gasoline for October delivery rose 1.57 cents to $1.83 a gallon and heating oil gained 1.42 to $1.82 a gallon while in London, Brent crude was up 22 cents at $69.87.

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Indian Govt. disinvestment plans to kick off soon !

Indian Govt. disinvestment plans to kick off soon !

Indian Power Firm NHPC Ltd will kick off a $1.25 billion IPO next week in the first share sale by a state company.

Since the congress party’s unexpectedly strong re-election in May spurred investors hopes for pro market reforms. πŸ™‚

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Despite opposition from labour groups and leftist parties, the government is forecast by some watchers to offload roughly $5 billion a year in state shares.


This could hearten a bond market worried about fiscal responsibility, but do little to address a yawning deficit and $90 billion borrowing plan.

Investors are expected to lap up shares in government firms, given :

a) attractive pricing,

b) a record of outperformance relative to IPOs by private firms,

c) and a roaring stock market run since March. πŸ™‚

NHPC opens its IPO on August 7 in what would be the first for a state firm in India since Feb. 2008.

Oil India is expected to follow with a $500 to $600 million issue in September.

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Also in the works could be a multi-billion-dollar IPO by telecoms firm Bharat Sanchar Nigam Ltd.

Secondary offerings by power equipment maker Bharat Heavy Electricals, Rural Electrification Corp, trading firm MMTC Ltd and mining firm NMDC Ltd. are also in queue.


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The pipeline of equity from state firms promises to top the record $6 billion raised from government asset sales between 1999 and 2004 when the pro-business Bharatya Janata Party (BJP) was in power.

During that period, shares were sold in firms such as Oil and Natural Gas Corp and Maruti Suzuki.

Since then, the government raised just $1.4 billion as allies of the ruling coalition and labour unions thwarted plans for stake sales.

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Indian state companies that listed between 2004 and 2009 have shown share price gains on average of 140 percent compared with just 3.5 percent for their private sector peers, according to a study by SMC Capitals, a deal tracking firm.