IPO-slaughter house

[himanshupremsharma]

Ipo ipo ipo ipo ipo ipo ipo ipo

 

[adityasaraf007]

Anyone with even a little bit of interest in IPOs should read Prof. Benjamin Graham's views about them in his book, "The Intelligent Investor". Read from page 139 through the end of Chapter 6 in the Fourth Revised Edition of the book (with Commentary from Jason Zweig).

An online version of the book is hosted by the Internet Archive over here.

 

[bikashkumar11]

...............

 

[durgesh]

Anyone with even a little bit of interest in IPOs should read Prof. Benjamin Graham's views about them in his book, "The Intelligent Investor". Read from page 139 through the end of Chapter 6 in the Fourth Revised Edition of the book (with Commentary from Jason Zweig).

An online version of the book is hosted by the Internet Archive over here.

Page 154 , IPO stands for :

1. It's Probably Overpriced
2. Imaginary Profits Only
3. Insiders' Private Opportunity
4. Idiotic , Preposterous & Outrageous

 

[bikashkumar11]

Dear Traderji members,

I was thinking if this thread can be use to gauge the performance of the promoter based on their IPOs valuation. will review those ipo only which was issued post 2005. why I am choosing the year 2005 is to make them relevant to current decades- to make it contemporary. The list of the IPOS that creates the wealth and distorts the value. lately realise the threat is one sided with the title...as slaughter house is little inappropriate ..it is still a slaughterhouse if you are an uninformed investors. Traderji to some extent has filled the gap of becoming wise investors from the minnows.

 

[umeshmandal]

There have been excellent IPO's too! We need due diligence to be done throughly and not be moved by analysts and brokerage house recomendations.

 

[bikashkumar11]

uunhjjjjhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhh

 

[mastermind007]

There have been excellent IPO's too! We need due diligence to be done throughly and not be moved by analysts and brokerage house recomendations.

Any company, before entering IPO market, does lot of window dressing on their accounting books and at least for a short while, their overall practices looks better than what is written in commerce textbooks. Kinda like, how folks decorate house during Diwali. Doing "due diligence" and reading all that fine print will usually reveal nothing alarming or bad.

NOW FOR SOME PRACTICAL/USABLE/EFFICIENT APPROACH based on FACTS

FACT: As a matter of practice, companies do provide shares to individuals on private basis prior to IPO.

In 1990s-2000s, the IPO was always at the face value of the share and 90% of shares had face value of 10 regardless of its book value and minimum purchase quantity was 100. Company whose book value was below face value had practically no subscription chances and the fundamental rule that "market price will approach book value"

Hence, in most IPOs, prices used to rise immediately after listing. This made trading in IPO very very attractive. I too had doubled my own meagre capital of 1000 rs 3 times in row. Strategy: Buy in IPO. Sell off on 2nd or 3rd day of listing

Nowadays, with offer price much above face value, probability of those pre-IPO share owners wanting to book profit is very high and hence chances of price dropping is very high. Many of them want to cash in on listing.

If you want to play IPO now, assuming you have ample time to do your "due diligence", either approach the IPO-ing company and try to (legally) avail the pre-IPO shares privately or find opportunity to Short at listing.

 

[amitrandive]

Any company, before entering IPO market, does lot of window dressing on their accounting books and at least for a short while, their overall practices looks better than what is written in commerce textbooks. Kinda like, how folks decorate house during Diwali.

As a matter of practice, companies do provide shares to individuals on private basis prior to IPO.

In 1990s-2000s, the IPO was always at the face value of the share and 90% of shares had face value of 10 regardless of its book value and minimum purchase quantity was 100. Company whose book value was below face value had practically no subscription chances and the fundamental rule that "market price will approach book value"

Hence, in most IPOs, prices used to rise immediately after listing. This made trading in IPO very very attractive. I too had doubled my own meagre capital of 1000 rs 3 times in row. Strategy: Buy in IPO. Sell off on 2nd or 3rd day of listing

Nowadays, with offer price much above face value, probability of those pre-IPO share owners wanting to book profit is very high and hence chances of price dropping is very high. Many of them want to cash in on listing.

If you want to play IPO now, either approach company going for IPO and get yourself shares privately before IPO or find oppurtunity to Short.

Another overpriced IPO where promoters it seems have started offloading their stake.

http://in.reuters.com/article/2015/11/02/india-coffee-day-idINKCN0SR0BO20151102
http://economictimes.indiatimes.com...u-subscribe-or-avoid/articleshow/49334515.cms

 

[amitrandive]

IPO performance trackers

http://www.chittorgarh.com/ipo/ipo_perf_tracker.asp?FormIPOPT_Page=1
http://www.moneycontrol.com/ipo/ipoissues/ipoissues.php