Over half of IPOs on BSE, NSE trading below offer price: Govt
Friday, 25 April 2008, 01:44 IST
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New Delhi: More than half of the total initial public offerings (IPOs) listed on BSE and NSE in the last two years are trading below their offer price. Around one-third of them are trading at a discount of 40 to 60 percent, Parliament was informed on Tuesday. During the time period from April 1, 2006 to March 31, 2008, the number of IPOs listed on the Bombay Stock Exchange stood at 150, of which 86 are trading below their offer price, Minister of State for Finance Pawan Kumar Bansal said in a written reply to the Rajya Sabha. And of these, 36 IPOs were trading at a discount of more than 40 to 60 percent of the issue price, he added. Meanwhile, of the 162 IPOs listed on the NSE during the same period, 88 were trading below the issue price and 38 were being traded at a discount of more than 40 percent of the issue price, he said. "The authorities do not try to manage or control prices. They endeavor to build systems and broaden markets which can stand volatility," Bansal said. He further said that under the current practice, the price of IPOs, is discovered by the market through book building mechanism, while the authorities make efforts to provide all the relevant information to market participants.
Source: IANS
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