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Thursday, March 30, 2017

IPO GREY MARKET AND ITS WORKING

IPO Grey Market is an unofficial market where IPO applications or *shares are bought and sold before they become officially available for trading on the stock exchange.

All transactions are done in cash on personal basis.

SEBI, Stock Exchange or Brokers are not involve or back these transaction.

It includes:
- Trading (selling or buying) IPO Applications at certain rate (premium) and
- Trading (selling or buying) allocated IPO shares before they list on stock exchanges.

Grey market trading is usually done among the small set of people who trust each other as there is no official platform or rules define for these trading

Terms used:

Grey market premium: Premium amount at which IPO shares are traded on stock market before they get listed on stock exchange. It can be positive or negative based on demand and supply of stock.

Kostak: Premium amount at which IPO applications are being traded in IPO Grey Market.
‘Kostak' is especially for people who do not want to take risk with IPO allotment or listing gains.

Who decides Grey Market Price?
Just like stock market or commodity market trading, IPO Grey Market

Premiums are decided on basis of demand and supply

If there are more buyers than sellers, the price goes up and vice versa.

Precaution:
As there are no regulatory bodies involved in Grey Market Trading and therefore there are no limitations on price momentum. Grey market premium may rise or fall suddenly

Wednesday, March 29, 2017

There are always success stories in stock markets - with the likes of Infosys, Wipro, Eicher Motors circulating these days. But Does Long Term really and always pay off? Well, let's think again...

Stock Markets are fascinating. Indian Stock Markets can compete with the rest of world for the success stories, scandals, intrigue and the tales of disasters.

It is said that Stock Markets are the barometer of a nation’s economic progress. It is often debated but the majority argument favors this statement.

Stock market has given returns which are higher then any other asset class.

Then there are the great stories of Infosys, Wipro, Eicher Motors giving unimaginable returns on investment.

But there are two sides of every coin.

The Story Nobody Likes To Tell

In the NIFTY index, there are 50 stocks ( NIFTY actually means NSE FIFTY ).

( Oddly, though at present there are 51 )

These stocks are based mainly on market capitalization. When a constituent loses value significantly, it is removed from index and replaced by another stock. No one talks of these stocks which got removed.

They were the stars of the day at some point of time and are duds today. Those were the investment ideas of that time and relegated to horror stories now. I will talk about this aspect which no one talks about.

The Wealth Destroyers:

These stocks may be not in favor presently, but were the flavor of the month at their prime. They were part of the NIFTY index or otherwise very highly regarded and traded. Today they are shunned and forgotten, but there are real people holding these stocks wondering how they will ever recover their money. NIFTY going up does not have a meaning for them.

Reliance Communication:

On Jan 08, 2008 , the stock traded at a lifetime high of Rs. 844.70

The lifetime low was around Rs. 30 few days back

2. Suzlon Energy:

The huge fall in this stock made me look for other similar stories.

It was added to NIFTY in 2006. In 2008, it traded above Rs. 2000 and then there was a stock split. The comparison is made taking into account the effect of splitting.

The lifetime High- Jan 09, 2008 — Rs. 412.88

The lifetime Low— August 28, 2013— Rs. 5.70

And the funny part is:

You will get to hear on business channels that Suzlon Energy has gained 158% in last three years.

3. Unitech:

It was a NIFTY stock in 2008. It was valued highly and was at a high of Rs. 546.80 on January 2, 2008.

What is the current price?

Rs. 5.90

It is around 1% of the high price.

Can the investor ever expect to make good their losses?

4. DLF:

From a high of Rs. 1225 in January 2008 , it trades for around Rs. 147 today.  Appears better than the others listed above, but 90% loss is not something to be taken lightly.

Even if it goes up by 100%, it will be nowhere near 1225.

5. Himachal Futuristics:

In December 2000, one of my friend bought for Rs. 1560 on one day and sold for Rs. 1605 next day. A day later it was Rs. 1675. He blamed himself for not taking profit.

Few months later was shocked when he saw a price of Rs. 90 in April 2001.

Today it trades at around Rs. 13.

Do you know what was the highest price?

Rs. 2578.05 on March 08, 2000.

In 16 years, the value of investment has come down to about 0.5%

A stock value can not fall 100%, but it is as near as you can get.

6. Jaiprakash Associates:

It was part of NIFTY. A big conglomerate in construction, power and cement business.

In January 2008, the high was Rs. 339.

Now it trades for Rs. 13.

Why This Story Needs To Be Told?:

It is a widely held belief that in the long run, markets give good returns.

This belief is true.

But the indices do not give the true picture.

In most of the above cited cases, the high price was in January 2008 ( except HFCL ) when NIFTY was around 6100.

Today, NIFTY is at 9200 but these stocks are at just at a fraction of their highs. Market has gone up but they continue to be laggards.

I have listed only a few. There are hundreds of such horror stories.

Index is adjusted by removing or adding stocks. An investor is not so agile.

You can lose money even when ma

rkets are going up.

What should be done to avoid such situations?:

Hindsight is always twenty twenty.

We need a good foresight.

No one knows that an INFOSYS will multiply a thousand times and HFCL will reduce to half percent value. In year 2000, both were the future stars. What a contrast today?

Protect your portfolio, like index protects itself. And take action earlier than the index does. In a long term portfolio, get rid of the stock, when it has fallen by about 15–20% of your purchase price.

There will be pain at that time, but not the endless pain which the investors of Unitech, Suzlon, JP Associates are enduring year after year.

I can not suggest that you should stay invested in Blue Chips.

All these were Blue Chips in their prime.

Conclusion:

Indian stock markets are wonderful. There are success stories, but so are the doomsday tales. All make for fascinating stories.

There are inspiring stories of Rakesh Jhunjhunuwala, but the sordid saga of Harshad Mehta also looms in the background.

Do not let the euphoria of the bull market impact you. Pay heed to the beaten down cases also. Learn your lessons from them.

A balanced view will make you a better investor and trader.....

CL Educate IPO Allotment Status is expected to be announced shortly. Please check back this space for latest updates

Monday, March 27, 2017

AU Financers gets SEBI approval for its IPO. Jaipur-based small finance bank licence holder Au Financiers gets Securities and Exchange Board of India, or Sebi’s approval to launch an initial public offer (IPO), according to sources. The company will launch the IPO, which will be pure offer for sale in the next quarter.

According to draft red herring prospect (DRHP) as shown on Sebi’s website, existing shareholders of the company will sell 53.4 million shares through offer for sale.

The company has reduced its foreign holding recently to 49% after Kedaara Capital, ChyrsCapital Investment Advisors India Pvt Ltd, International Finance Corporation and Warburg Pincus partly exited the company, while Motilal Oswal Private Equity made a complete exit. ICICI Securities, HDFC Bank, Motilal Oswal Investment Advisors and Citibank are merchant bankers for the IPO.

Sunday, March 26, 2017

Reliance CPSE ETF FFO 2 Transaction and allotment status can be checked from the below mentioned linkC

PSE ETF FFO 2 allotment status can be checked on the below link. Steps to check Allotment. First select Reliance Mutual Fund then Purchase and then enter your PAN to know the status.

https://www.karvymfs.com/karvy/InvestorServices/General/InvTransactionStatusnew.aspx

HUDCO IPO Details

Issue Opens on: 05 April 2017
Issue Closes on: 07 April 2017
Issue Type: Book Built Issue IPO
Issue Size: 20,01,90,000 Equity Shares
Face Value: Rs 10 per Equity Share
Price Band: Rs.48 – Rs.50 per equity share
Bid Lot: 300 shares and in multiples thereof
Listing At: NSE, BSE

Friday, March 24, 2017

Shankara BuildPro IPO subscription status - Day 3 at 3:50 PM

QIB*: 51.19x (*excluding Anchor)
NII: 82.24x
RII: 12.45X
Overall: 38.48 times

Applications: 845,545 Approx
No. of Applic-wise: 10.31x

Shankara BuildPro IPO subscription status - Day 3 at 1:00PM

QIB*: 4.46X (*excluding Anchor)
NII: 2.20X
RII: 9.05X
Overall: 6.27 times

Applications: 605,500 Approx
No. of Applic-wise: 7.368X

GMP 105 – 108

QIB: 0.75x
HNI: 0.49x
Retail: 4.35x
Overall: 2.49 times

Wednesday, March 22, 2017

CL Educate Ltd Subscription status Day 2, March 21, 2017

QIB: 1.97x, 
HNI : 0.04x, 
Retail : 0.40x, 
Overall : 0.77 times

Tuesday, March 21, 2017

CL Educate Ltd Subscription status Day 2, March 21, 2017 as of 12.00pm

QIB: 1.67x,
HNI : 0.10x,
Retail : 0.23x,
Overall : 0.60 times

Avenue Supermarts IPO (D-Mart IPO) Listing


The equity shares of Avenue Supermarts Limited, the company behind D-Mart retail stores listed with a big bang on the exchanges with the shares opening at a staggering 100 percent premium over the issue price


The shares opened at Rs.604.40 on the BSE and had touched an Intraday high of Rs. 615 and intraday low of Rs.558.75 on the BSE. The scrip is stable and trading at around Rs.605 as at the noon


The IPO of Avenue Supermarts Limited was heavily oversubscribed at 104 times on an overall basis and 7.30 times in the Retail category. It remains to be seen if the stock is able to sustain these kind of levels in upcoming trading days


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