sit journal of management vol. 1. no. 1. june 2012. pp. 82 - 105 · 2013-08-13 · sit journal of...

SIT Journal of Management

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Comparative Analysis of Listing Performance of Minor IPOs issued

during boom period and recession period

Sajal Das*

Abstract

Initial Public Offerings (IPOs) have always attracted retail investors in the hope of making quick

money on listing. Relatively minor IPOs with small issue sizes seem to be severely underpriced

and so it is essential to study the listing performance of some selected minor IPOs during the

decade 2000 to 2009 comprising of ten years. This research paper examines the minor IPO issues

performance on listing and to test whether listing performance of minor issues are affected by the

boom or recession in the IPO market. Keeping this in mind the paper attempts to study a sample

of twenty minor issues selecting twelve from boom period and eight from recession period

during the decade under study and present a comparative analysis of the listing performance.

Listing performance is computed based on three parameters namely raw return on listing, simple

underpricing and adjusted underpricing. A t-test is carried out between these two independent

samples on these three parameters to assess whether listing performance significantly varies

between boom or recession period. Results derived from sample companies could not establish

any significant difference in listing performance between boom period minor IPOs and recession

period minor IPOs. Moreover severity in underpricing of minor IPOs is also not observed.

Underpricing is found to be moderate and the extent of abnormality in adjusted returns is not so

prominent also.

Keywords: Minor IPO, Under pricing, Listing performance.

* Sajal Das, Assistant Professor, Department of Commerce and Management, West Bengal State University, India, email : [email protected] ,M : +91(0)9038000755.

Introduction


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The Indian Securities market is one of the leading stock markets of the world. The Primary

segment of the Indian securities market which is also referred to as the New Issue market

(NIM) or the Initial Public Offering (IPO) market is the cynosure of all retail investors since

the abolition of Capital Issues (Control) Act, 1947 on May, 1992. IPOs are now being freely

priced and it is altogether left to the judgment of the issuing companies to price their new

securities. Even though in stricter sense, New Issue market and Initial Public Offering

should not be referred interchangeably. One thing needed to be clarified at the very onset

that a new issue not only pertains to the first issue of securities but also next and

subsequent issues too. Rather every time a company desires to raise fresh issue of capital

they have to approach the primary market but in those cases it will be referred as Follow-

on Public Offerings (FPO) and not Initial Public Offerings. Primary market acts as a gateway

for Companies to raise resources for their financial needs. Resource mobilisation through

Primary market is not a recent phenomenon and both listed as well as unlisted companies

use this route to generate funds for themselves. There is no exact specific definition of IPO

as per any statutory act be it the Companies Act, 1956 or the Securities and Exchange

Board of India Act, 1992. But in terms of Regulation 2 (1) (p) of the Securities and Exchange

Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009 an “initial

public offer means an offer of specified securities by an unlisted issuer to the public for

subscription and includes an offer for sale of specified securities to the public by any

existing holders of such securities in an unlisted issuer.” In simple parlance, Initial Public


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Offering refers to the first issue of securities by a company since the beginning of its

formation.

The following table highlights the importance of IPO for the Indian economy. As we can

clearly see from the table below that during the decade under study how Indian Companies

have procured resources for their needs through IPO route.

Table 1: Resources Mobilised from the Primary Market by way of IPOs

Year 2000-

01

2001-

02

2002-

03

2003-

04

2004-

05

2005-

06

2006-

07

2007-

08

2008-

09

2009-

10

No. of

Issues 114 7 6 21 23 79 77 85 21 39

Amt.

(Rs.Cr) 2,722 1,202 1,039 3,434 13,749 10,936 28,504 42,595 2,082 24,696

Source: Handbook of Statistics on the Indian Securities Market, SEBI, 2010

Literature Review:

Shah (1995) conducted one of the early works on Indian IPOs where he identified the

empirical regularities about India’s IPO market for the period January 1991 to April 1995.

He worked with a sample size of 2056 and found that on the average the price at first

listing was 105.6% above the offer price. Madhusoodanan and Thiripalraju (1997) did

extensive analysis on Indian IPOs during 1992-1995. They reported an average initial

underpricing of 75.21%. They tested a number of hypotheses using data of 1922 IPOs.


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Madan (2003) studied the under pricing of IPOs and found a very high initial excess return

on IPOs in the Indian primary capital market as compared to other countries. The study

included 1,597 companies during 1989-1995 listed at the BSE. Ghosh (2004) attempted to

depict a detailed investigation in respect of the boom and slump phases in the Indian

primary capital market. His study concentrated on two key variables, namely IPO volume

and initial returns and analyses their nature and interrelation during these two periods.

Several studies had been conducted in the Indian IPO market to assess the short term and

long term performance of IPOs. In this research work the intention is to study the minor

IPOs issued during the last decade and their listing performance with respect to their issue

price.

Objective of the Study:

The primary objective of this research work is to assess the first day listing performance of

selected minor IPOs issued during the study period between 2000 to 2009 comprising ten

years and then to present a comparative analysis of those IPOs which are issued during the

boom period vis-à-vis recession period of the IPO market. To achieve this purpose, the

following objectives are set forth:

1. To compute the first day initial returns defined as raw return on listing (RL);

2. To examine the extent of Simple Underpricing (UPS) on listing day itself;


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3. To test whether first day adjusted listing returns (UPA) significantly differ for minor

issue IPOs during boom and recession season of New –Issue market (NIM).

Research Methodology adopted:

(a) Data and their sources: The raw data used for the entire study during the study

period starting from 01.01.2000 to 31.12.2009 accounting for ten calendar years is

mainly the stock prices of the companies which have gone public through IPO during

this time period. Besides the stock prices of the individual companies, index value for

the relevant stock indices is also used. The entire stock prices and stock indices are

based on data from the data base of National Stock Exchange (NSE) of India Limited

website. NSE is currently the largest stock exchange in India in terms of trading

volumes and by far the most transparent -delivery and settlement mechanism wise. So

the study is completely based on secondary data.

(b) Criteria for selecting samples and sampling technique adopted: Since the study is

based only on the IPO mode of public offerings, we have ignored follow on public

offerings and offer for sale issues during this period. Similarly we have restricted our

sample selection only to those companies which are listed and traded on NSE and have

gone public through Book-building method of IPO only. Moreover for the specific

purpose of our study we need to categorize issue year as Boom (B) season or

Recession (R) season of IPO Market based on the number of issues during that year in


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comparison to the average number of issues for the entire study period. For example,

the calendar year 2005 is considered as Boom period because 41 issues (self-

computed) have accessed the IPO market which is more than the average figure of 32.8

for the entire study period. Similarly with 30 issues during calendar year 2008 is taken

as a recession period which is below the average computed by us.

Table 2: Number of Companies gone public during Study Period (2000-2009)

Calendar

year

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Total Average

NSE website 11 2 2 5 21 50 73 95 36 21 389 38.9

Self

computation 9* 2 2 5 15** 41@ 61# 85^ 30% 20σ 328 32.8

IPO Season R R R R R B B B R R

Source: Self computation

B indicates Boom period and R indicates Recession period of IPO market.

* indicates 2 companies not listed and traded on NSE,

** indicates 5 are offer for sale and 1 is FPO,

@ indicates 9 issues are FPO,

# indicates 4 companies not listed and traded on NSE and 8 issues are FPO,


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^ indicates 8 companies are not listed and traded on NSE, 1 issue withdrawn and 1

cancelled,

% indicates 3 issues are withdrawn and 3 are not listed and traded on NSE and

σ indicates 1 company not listed and traded on NSE.

Minor issue IPOs are those IPOs whose issue sizes are restricted up to Rs.100 Crores. So

those issues which are beyond this cut-off size of Rs. 100 Crores are not considered for the

purpose of this study as they are not categorized as Minor IPOs. Thereafter we have

adopted purposive sampling technique to select our twenty (20) sample companies for the

study. Purposive sampling being a non-probability sampling is done to solve the research

problem with a specific purpose in mind so as to include only those samples which will

fulfill the purpose of the study. This technique of sample selection is quite similar to

judgment sampling with an only difference being that more emphasis is placed to achieve

the purpose of research study. The entire list of sample companies selected and their issue

details specifying the offer period, issue size, offer price, issue price and date of listing is

given under appendix 1. The final selection of sample and its classification is depicted

below in the following table for having a better glance of the total picture.

Table 3: Sample Classification and Distribution


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Criteria Boom Recession Total

Total Issue

Size

(Rs.Cr.)

Mean Issue

Size

(Rs.Cr.)

Minor

Issues 12 8 20 668.655 33.43276

Source: Self –computation

(c) Models adopted for analysis: Let us discuss the models used to compute various

returns to assess underpricing on the day of listing. For the purpose of measuring the

extent of underpricing we have used the following model:

For Initial Return on Listing Day (Day 1):

We compute three different types of initial return on the day of listing as stated

below:

(i) Raw Return on Listing= ln (Listing Price/Issue Price) * 100

Symbolically, RL = ln (LP/IP) * 100

This is intended to measure the listing gain to the allotees’ who are being

successfully allotted their shares at final price referred to as “issue price”.

Infact listing price is the very first price that is flashed on the ticker of the

stock exchange on the listing date of IPO.


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(ii) Simple Underpricing i.e. Unadjusted Return = ln(Closing stock price on

listing day/Issue Price) * 100

Symbolically, UPS = ln (CP1/IP) * 100

This expression measures the return to the IPO allotees’ who are holding

their allotment till the end of the first day trading session.

(iii) Adjusted Underpricing (Initial Returns) on Listing = ln(closing stock price

on day of listing/Issue Price) *100 – ln(Closing Index on listing day/Closing

Index on Offer Closing day) * 100

Symbolically, UPA= [ln (CP1/IP) – ln (CI1/CI0)] * 100

This measures the abnormal return arising to the investors after adjustment

with the return arising from the relevant stock index on that day. Any excess

return over and above the normal benchmark return arising from the

relevant stock index is referred as abnormal return from IPO.

Since the entire data set is obtained from the Historical data base of the website of

NSE it is prudent to use the major indices of the same exchange for obvious purpose.

While computing the adjusted returns of the selected sample companies on the

listing day, it is necessary to compute such excess returns with regard to a

benchmark stock index which will be a good representative of the total sample

under consideration. The Index choice selected for the minor companies is S&P CNX


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500 which is India’s first broad based benchmark of the Indian capital market. This

Index represents about 95.86% of the free float market capitalization of the stocks

listed on NSE and companies included in this Index are disaggregated into 71

industry indices.

(d) Framing of Hypothesis: To perform this research work several hypothesis needed

to be framed and statistical test shall be conducted to give direction to the stated

objectives. Accordingly we have framed the following set of Null Hypothesis which is

stated below:

H10: There is no significant difference in mean raw listing return between Boom

period and Recession period of Minor issue IPOs

H20: There is no significant difference in mean simple underpricing between Boom

period and Recession period of Minor issue IPOs

H30: There is no significant difference in mean adjusted underpricing between

Boom period and Recession period of Minor issue IPOs

(e) Statistical tests used for analysis: Various returns computed from the series of stock

prices belong to interval scale which refers to such a scale where the interval between

successive positions is equal. Being interval scale of data, we would like to perform

parametric test to derive results. For this the very first thing that needs to be done is to


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test the normality of data. There are several ways to tell whether a variable deviates

significantly from normal. We will perform the Kolmorogov-Smirnov (K-S) test using

SPSS statistical software package in support of our justification for adopting traditional

transformation and accordingly substantiate using the statistical parametric test for

our research study. Thereafter F-test, more specifically Levene’s F-test will be carried

out to establish if the two samples have same variance. Depending on the result of F-

test, a t-test is carried out for independent samples to establish differences of mean.

We want to carry out Levene’s F-test as it is not dependent on the assumption of

normality, even though we will be testing the normality of variables. All statistical tests

are to be performed using SPSS statistical software package version 15.0.

Computation of Returns on Listing Day: In this Section we now reproduce the entire

computation of RL, UPS and UPA of all the twenty sample companies segmented over boom

and recession period in tabular form to provide an overall glimpse of the listing day

performance as computed by us according to the methodology already stated.

In the next tables 4 and 5 we take up the computed results of minor issue IPOs during the

boom period and recession period and then present a brief analysis of the computed

results to understand the extent of underpricing and abnormality in returns for the minor

issue companies.


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Table 4: Computed Result of Listing Day Performance of Minor IPOs issued during Boom Period

Company

Raw Return on Listing

(RL)

Simple Underpricing

(UPS)

Adjusted Underpricing

(UPA)

BARAK VALLEY 39.91 27.51 28.63

AURIONPRO 12.52 16.88 26.77

RUCHIRA 4.26 (8.86) (5.45)

TFL 7.41 (9.16) (2.67)

OMNITECH 55.96 44.22 48.70

SEL MANUFACTURING 5.41 47.52 58.07

SUPREME INFRA 55.16 48.32 42.43

POCHIRAJU 40.77 50.38 49.27

JHS 49.34 (1.83) (5.85)

LT FOODS 6.90 (5.13) (4.28)

LOKESH MACHINES 41.33 48.51 39.92

AMAR REMEDIES 69.31 69.67 63.66

Source: Self computation (Figures in parentheses indicate negative value.)

The minor issue IPOs during the boom period performed quite well as is evident from the

raw return on listing figures. All twelve issuers could manage a positive return on listing


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for their investors with three companies – Amar Remedies, Omnitech Infosolutions and

Supreme Infra giving return beyond 55 percent and another three companies – JHS

Svendgaard Laboratories, Lokesh Machines and Pochiraju managed to exceed 40 percent

return and another one company Barak Valley Cements touching almost 40 percent. In

fact, Amar remedies was able to generate almost 70 percent raw return on listing for its

shareholders. This is the highest return observed so far in terms of RL. Four companies

Ruchira Papers, Transwarranty Finance Limited, JHS Svendgaard Laboratories and LT

Foods issue price was found to be over priced on listing and all of them failed to generate

any abnormal return for its investors and for the remaining eight companies the issue price

was under priced (UPS) ranging from as high as 69.67 percent for Amar Remedies to as low

as 16.88 percent in case of Aurionpro Solutions. The same eight companies also generated

abnormal return for its investors on the very first day of trading session itself. Remarkably

significant abnormality in listing day returns based on UPA computation is observed in case

of four companies viz. Amar Remedies, SEL Manufacturing, Pochiraju Industries and

Omnitech Infosolutions with Amar Remedies generating an adjusted abnormal return of

63.66 percent over and above the benchmark index return S&P CNX 500.

In the next table we now present the computed listing day returns for the minor issue IPOs

issued during the recession period of eight companies under consideration.


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Table 5: Computed Result of Listing Day Performance of Minor IPOs issued during Recession Period

Company

Raw Return on Listing

(RL)

Simple Underpricing

(UPS)

Adjusted Underpricing

(UPA)

EDSERV 0.00 83.07 91.67

20MICRONS 37.47 (49.13) (29.08)

ALKALI (3.96) 52.09 64.42

VARDHAMAN ACRYLIC 18.23 10.44 2.39

BALAJI TELEFILMS 37.90 18.87 16.21

SITASHREE 15.42 37.62 38.61

LOTUSEYE 5.13 (6.38) 1.89

CORDSCABLE 5.76 3.24 6.95

Source: Self computation (Figures in parentheses indicate negative value.)

The raw return on listing is positive for six issuing companies, with one company Alkali

Metals giving a negative return and another one- Edserv Softsystems giving a nil return to

its investors. Balaji Telefilms and 20 Microns are able to generate approximately 37

percent raw return on listing whereas Vardhaman Acrylic and Sitashree Food just manage

to exceed 15 percent for its investors. The most significant observation is the severe

underpricing of Edserv Softsystems which stood at 91.67 percent over and above the


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benchmark index return. Out of the entire sample of twenty companies, this is the only

observed case where we found such severe underpricing based on UPS and UPA

computation of Edserv Softsystems. Six companies issue price was underpriced with

respect to the issue price and only two companies 20 Microns and Lotus Eyecare issue

price was overpriced based on UPS computation.

So overall the minor issue IPOs performs on an average and gave some returns to its

investors on the first day of listing itself. Out of the 20 minor issue IPOs in total only 4

issuing companies could generate abnormal return over and above the 50 percent mark.

Overview of Listing Day performance

In this section we present an overall analysis of the listing day performance of the twenty

sample companies based on the previously computed RL, UPS and UPA values specified in

the preceding section. It is a known fact that IPOs are severly underpriced which has been

already documented both internationally as well as in our Indian context. The following

tables 6 and 7 present the listing performance of our sample companies.


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Table 6: Analysis of Listing Performance based on Raw Return on Listing (RL)

ISSUE

TYPE SEASON

NOS. OF COMPANIES WHOSE RAW RETURN ON LISTING (RL) VALUE IS

≤0%

>0% to

25%

>25% to

50%

>50% to

75%

>75% to

100%

>100%

MINOR

(20)

BOOM (12) X 5 4 3 X X

RECESSION

(8)

2 4 2 X X X

TOTAL (20) 2 9 6 3 X X

Source: Self Computation

The raw listing performance of minor IPOs are not so lucrative as we can observe that none

of the issuing company could generate a raw return of higher than 75 percent. Infact only

three issuing companies could generate a return within a range of 50 percent to 75 percent

and all three were issued during the boom period of IPO market. So apparently it seems

boom period is able to give substantial return to its investors. Almost fifty percent of the

issuing companies i.e. nine out of twenty companies under consideration could only give a

return upto 25 percent and another six companies could generate return within a range of

25 to 50 percent. So we can state that seventy five percent of the issuing companies i.e.

fifteen out of twenty sample companies have generated a healthy return of upto 50 percent.

And two companies during recession period failed to give any positive raw return to its

investors at all. In other words, these two companies issue price were not underpriced at

all in comparision with the listed market price on day-1.


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Table 7 Listing Performance depicting the extent of Underpricing

ISSUE

TYPE SEASON

NOS. OF COMPANIES WHOSE SIMPLE AND ADJUSTED UNDERPRICING

(UPS AND UPA) VALUE IS

≤0%

>0% to

25%

>25% to

50%

>50% to

75%

>75% to

100%

>100%

UPS UPA UPS UPA UPS UPA UPS UPA UPS UPA UPS UPA

MINOR

(20)

BOOM (12) 4 4 1 X 6 6 1 2 X X X X

RECESSION

(8)

2 1 3 4 1 1 1 1 1 1 X X

TOTAL (20) 6 5 4 4 7 7 2 3 1 1 X X

Source: Self computation

On the basis of the observed data in the above table, it can be conclusively stated that none

of the issuing minor IPOs are severely underpriced as not a single company issue price is

underpriced to the extent of 100 percent or more. It is observed that four issuing

companies during boom period of IPO market gave negative adjusted return out of a

sample of twelve companies whereas only one company gave a negative adjusted return

during recession period out of a sample of eight companies under consideration. Fifty

percent of the boom period issuing companies i.e. six out of twelve minor IPOs gave a

healthy return as their adjusted underpricing measured within the range of 25 percent to


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50 percent which is over and above the relevant benchmark index. And fifteen companies

out of the entire sample of twenty i.e. seventy five percent of the sample was able to

generate positive return over and above the benchmark index as we can observe from the

adjusted underpricing computed results.

Testing of Normality of Test Variables:

In this section we carry out the K-S Test using SPSS software package to ascertain whether

the computed values for the twenty samples under study categorized into two groups –

boom period and recession period can be put to parametric test and as such we want to

determine whether the RL, UPS and UPA values follow a normal distribution.

Two-Sample Kolmogorov-Smirnov Test Output is given in the following table:

Source: SPSS Output

There are two important results in the above table. The first is the test-statistic

kolmogorov-Smirnov Z value in the second last line of the above table and the second

important is in the bottom line which gives the ‘p’ value listed as asymptotic significance

(2-tailed). Non-parametric K-S method tests the null hypothesis that the data do not differ

Table 8: Test Statistics a

.583 .250 .292

.000 .167 .250 -.583 -.250 -.292 1.278 .548 .639

.076 .925 .809

Absolute Positive

Negative

Most Extreme Differences

Kolmogorov-Smirnov Z Asymp. Sig. (2-tailed)

Listing Return Simple

UnderPricing Adjusted

UnderPricing

Grouping Variable: IPO Season a


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from a normal distribution. If P> 0.05 then we can accept the null hypothesis and state that

the data under consideration do not differ significantly from the normal distribution. In the

result output box above, we can see that the P value for all the three test criteria i.e. listing

return, simple underpricing and adjusted underpricing is 0.076, 0.925 and 0.809

respectively which is all greater than 0.05 and as such we can conclude that the dataset

under consideration does not significantly differ from normal distribution and we can now

safely carry on with our parametric tests to perform the hypothesis testing.

Hypothesis Testing:

Keeping in mind the objectives set forth earlier and the three null hypothesis framed H10,

H20 and H30 we now have performed the Levene’s F- test to establish whether the samples

have equal variances. If the variances of the two samples do not differ significantly then we

can comfortably carry out the t-test and safely interpret the results so that logical

conclusions can be drawn.

Table 9: Group Statistics

IPO Season N Mean Std. Deviation Std. Error

Mean

Listing Return Boom 12 32.35672 23.58759 6.809152

Recession 8 14.49228 16.05815 5.677413

Simple UnderPricing Boom 12 27.33692 27.89620 8.052942

Recession 8 18.72626 39.91779 14.11307

Adjusted UnderPricing

Boom 12 28.26531 26.38059 7.615422

Recession 8 24.13262 38.82447 13.72652

Source: SPSS Output


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Table 10: Independent Samples Test

Source: SPSS Output

For the two sample under consideration, the results of F-test indicate that on the basis of

three criteria of Listing return, Simple Underpricing and Adjusted Underpricing, the P-

value is greater than 0.05 and as such the variances of the two independent sample are not

significantly unequal. In other words, we can now interpret the t-test results safely.

Levene's Test for Equality of Variances t-test for Equality of Means

F Sig. t df Sig. (2-tailed)

Mean Differen

ce

Std. Error

Difference

95% Confidence Interval of the

Difference

Lower Upper Lower Upper Lower Upper Lower Upper Lower

Listing Return Equal variances assumed

4.101 .058 1.865 18 .079 17.8644 9.57739 -

2.2569 37.985

Equal variances not assumed

2.015 17.966 .059 17.8644 8.86552 -

.76386 36.492

Simple Under Pricing

Equal variances assumed

.374 .549 .570 18 .576 8.61066 15.1054 -

23.124 40.345


.530 11.523 .606 8.61066 16.2489 -

26.956 44.177

Adjusted Under Pricing

Equal variances assumed

1.270 .275 .285 18 .779 4.13269 14.5163 -

26.365 34.630


.263 11.292 .797 4.13269 15.6975 -

30.308 38.574


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Interpretation of Results of Hypothesis Testing:

For H10: The P-value stood at 0.079 i.e. P>0.05, so we do not reject the null hypothesis and

state that there is no significant difference in mean listing return of Minor IPOs issued

during Boom or Recession period.

For H20: The P-value stood at 0.576 i.e. P>0.05, so again we do not reject the null

hypothesis and state that there is no significant difference in mean simple underpricing

between Boom period and Recession period Minor IPOs.

For H30: Here the P-value stood at 0.779 i.e. P>0.05 , so we do not reject the null

hypothesis and state that there is no significant difference in mean adjusted underpricing

of Minor IPOs issued during Boom or Recession period.

Conclusion:

From the research work carried out with the twenty IPO issuing companies of minor sizes

we cannot conclude that boom period IPOs are more underpriced in comparison to

recession period. There was an apprehension that seasonality of the IPO market at the time

of issue is an important determinant in assessing whether IPOs are underpriced or not. But

from this study carried out the same cannot be concluded. Even the adjusted underpricing

results show no significant impact due to Boom or Recession period of IPO market. So again

we cannot conclude that issuers of minor IPOs is able to generate higher return on listing

day for its investors during boom period rather than recession period. It can be finally


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stated that minor IPOs as a whole are not severely underpriced as not a single issuing

company is found to be underpriced to the extent of 100 percent and above in comparison

to the research findings of the previous decade of this study.

References:

Aggarwal, Deepak (2006), IPO Pricing – Book Building and Efficient Pricing

Methodology, www.ssrn.com/abstract=1311749.

Banerjee, Arindam (2006), Indian Capital Markets- Trends & Reforms, (ed.), The

ICFAI University Press, Hyderabad.

Baral S. and Obaidullah Mohmmed (1998), Short-run Price Behaviour of IPOs in

India, Some Empirical Findings, UTI Institute of Capital Markets.

Barel, Sushant Kumar (2000), An Empirical Investigation into Pricing of Initial Public

Offerings in India (1999-2000), Ph.D. Unpublished Thesis, Berhampur University,

Orissa.

Basu, Indrajit (2005), Boom Time for India’s Primary Share Market, Asia Time Online,

www.atime.com

Ghosh, Sourabh (2004), Boom and Slump Periods in the India IPO Market, RBI

Occasional Papers, Vol. 25, No.1, 2 and 3, Summer, Monsoon and Winter.

Krishnamurti C. and Pradeep Kumar (2002), The Initial Listing Performance of

Indian IPOs, Managerial Finance, Vol.28, pp. 39-51.

Madan, Arwah Arjun (2003), Investments in IPOs in the Indian Capital Market,

Bimaquest, Vol.III, Issue 1, January, 2003.

Madan, Arwah Arjun (2003), Behaviour of IPOs in the Pre and Post Liberalisation Era

in the Indian Capital Market, Indian Capital Market – An Empirical Study (ed.),

Anmol Publication, New Delhi.


Vol. 1. No. 1. June 2012. Pp. 82 - 105

23

Das

Madhusoodan, T.P. and Thiripalraju M. (1997), Underpricing in IPOs: The Indian

Evidence, Vikalpa, Vol.22, pp. 17-30.

Narasimhah, M.S. and Ramana, L.V. (1995), Pricing of Initial Public Offerings: Indian

Experience with Equity Issues, The ICFAI Journal of Applied Finance, Vol.1, pp. 26-39.

Shah Ajay (1995), The Indian IPO Market: Empirical Facts, www.cmie.ernet.in.

Indian Securities Market: A Review, National Stock Exchange of India Limited, Vol.

XI., 2008, www.nseindia.com

Handbook of Statistics on the Indian Securities Market, SEBI, 2009, www.sebi.gov.in

Appenix 1: Issue Details of Sample companies

Companies Issue Size

(Rs. Cr)

Offer Period Offer price

(Rs.)

Issue Price

(Rs.)

Date of

Listing

Barak Valley

Cements Ltd.

23.772 29 Oct-1 Nov

2007 37-42 42 23 Nov 2007

Edserv Softsystems

Ltd.

23.8434 5 -9 Feb 2009 55-60 60 2 Mar 2009

20 Microns Ltd.

23.9285 8-11 Sep 2008 50-55 55 6 Oct 2008

Alkali Metals Ltd.

26.265 7-15 Oct 2008 86-103 103 6 Nov 2008

Aurionpro Solutions

Ltd.

27 27 Sep-4 Oct

2005 81-90 90 25 Oct 2005

Vardhman Acrylics

Ltd.

27.1331 15-19 Sep 2003 10 10 30 Sep 2003

Ruchira Papers Ltd.

28.5 23-29 Nov 2006 21-23 23 20 Dec 2006


Vol. 1. No. 1. June 2012. Pp. 82 - 105

24

Das

Transwarranty Finance Ltd.

31.2 23 Jan- 2 Feb

2007 48-55 52 26 Feb 2007

Balaji Telefilms Ltd.

32.76 6-12 Oct 2000 130 130 22 Nov 2000

Sita Shree Food Products Ltd.

35

11-14 Mar 2008

27-30

30

7 April 2008

Omnitech

Infosolutions Ltd.

35 19-25 July 2007 90-105 105 14 Aug 2007

SEL Manufacturing

Co. Ltd.

37.2457 26-31 July 2007 80-90 90 21 Aug 2007

Supreme

Infrastructure India

Ltd

37.53 21-26 Sep 2007 95-108 108 18 Oct 2007

Pochiraju Industries

Ltd.

37.57 15-18 Jan 2007 25-30 30 9 Feb 2007

Lotus Eyecare

Hospital Ltd.

38 12-20 Jun 2008 36-38 38 11 July 2008

JHS Svendgaard

Laboratories Ltd.

38.86 26 Sep- 4 Oct

2006 49-58 58 21 Oct 2006

LT Foods Ltd.

39.4 27-30 Nov 2006 50-56 56 18 Dec 2006

Cords Cable

Industries Ltd.

41.6475 21-24 Jan 2008 125-135 135 13 Feb 2008

Lokesh Machines

Ltd.

42 7-13 April 2006 130-140 140 5 May 2006

Amar Remedies Ltd.

42 25-31 Aug 2005 24-28 28 16 Sep 2005

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