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IMPACT OF IPOS OVER INDIAN CAPITAL MARKET IN SHAREKHAN STOCK BROCKING COMPANY

Project report submitted in partial fulfillment for the award of degree in POST GRADUATE DIPLOMA IN MANAGEMENT By, Shyamsunder.V R.No:010-012-33 PGDM 2010-2012 Under the esteemed guidance of K.P SINGH Branch Manager (Thirumalgiry) & Dr. B. Ratan Reddy Professor& Faculty Guide

RATAN GLOBAL BUSINESS SCHOOL, HYDERABAD Approved by AICTE, Ministry of HRD, Govt of India, NewDelhi
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ACKNOWLEDGEMENT

While submitting the project on IMPACT OF IPOS OVER INDIAN CAPITAL MARKET I avail this opportunity to express our gratitude towards all those who guided and helped to finish this project successfully. I am grateful to K.P SINGH (BRANCH MANAGER), project guide, SHAREKHAN LTD, THIRUMALAGIRY, HYDERABAD for his inspiring guidance for his valuable guidance and encouragement, which has played a major role in completion of this project work. His esteem suggestion and encouragement from time to time has always helped in the completion of this project.I I express my sincere thanks to Dr. B. Ratan Reddy, President, RGBS for providing necessary facilities in college for this project. I am thankful to my teaching staff for their valuable guidance and encouragement in the completion of this project. I am grateful to my non teaching staff for their moral support and co-operation. I am thankful to my parents for their inspiring guidance and kind encouragement.

Thanking You,

SHYAMSUNDER.V

DECLARATION

I here by SHYAMSUNDER.V student of PGDM, RATAN GLOBAL BUSINESS SCHOOL, HYDERABAD hereby declare that this project report entitled IMPACT OF IPOS OVER INDIAN CAPITAL MARKET at SHAREKHAN submitted by mine is original work. The findings of the report are based on the information collected by us during the study and the result embodied in this study has not been submitted to any other university for the award of degree.

SHYAMSUNDER.V

PLACE: DATE:

CONTENT

S.No 1 2 3 4 5 6 7 8 9 10 11 12 13

INDEX Introduction To Company Profile Online IPOS Industry profile Objectives and functions of SEBI Financial markets and the IPO RESEARCH METHODOLOGY THEORITICAL FRAMEWORK What are IPOS SEBIS role in an issue Guidelines of book building Scope of the study Conclusion Bibliography 05 15 20 29 30 33 35 39 43 48 67 69 70

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INTRODUCTION TO COMPANY PROFILE

Sharekhan is online stock trading company of SSKI Group, provider of India-based investment banking and corporate finance service. ShareKhan is one of the largest stock broking houses in the country. S.S. Kantilal Ishwarlal Securities Limited (SSKI) has been among Indias leading broking houses for more than a century. Sharekhan's equity related services include trade execution on BSE, NSE, Derivatives, commodities, depository services, online trading and investment advice. Trading is available in BSE and NSE. Along with Sharekhan.com website, ShareKhan has more than 1500 offices (share shops) in 380 cities across the country. Sharekhan has one of the best states of art web portal providing fundamental and statistical information across equity, mutual funds and IPOs. We can surf across 5,500 companies for in-depth information, details about more than 1,500 mutual fund schemes and IPO data. We can also access other market related details such as board meetings, result announcements, FII transactions, buying/selling by mutual funds and much more. Sharekhan offers investment services in Equities, Derivatives, Commodities, Currency, Mutual Funds, IPOS, and PMS & Depository Services. Investors across India trust the Sharekhan team for its excellent and valuable investment advice. The Sharekhan site was launched on February 8, 2000 and named it as www.sharekhan.com The SpeedTrade account of share khan is the next generation technology product launched on April 17, 2002 SSKI a veteran equities solutions company with over 8 Decades of experience in the Indian stock markets. If you experience our language, presentation style, content or for that matter the online trading facility, youll find a common thread; one that helps you make informed decisions and simplifies investing in stocks. The common thread of empowerment is what Share khans all about. Sharekhan is also about focus. Sharekhan does not claim expertise in too many things. Share khans expertise lies in stocks and thats what he talks about with authority. So when he says that investing in stocks should not be confused with trading in stocks or a portfolio-based strategy is better than betting on a single horse, it is something that
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is spoken with years of focused learning and experience in the stock markets. And these beliefs are reflected in everything Sharekhan does for you. To sum up. Sharekhan brings to you a user- friendly online trading facility, coupled with a wealth of content that will help you stalk the right shares. Those of you who feel comfortable dealing with a human being and would rather visit a brick-and-mortar outlet than to a PC, youd be glad to know that Sharekhan offers you the facility to visit (or talk to) any of our share shops across the country. In fact Sharekhan runs Indias largest chain of share shops with over hundred outlets in more than 80 cities.

Sharekhan Advantages:
Sharekhan is a part of SSKI, an organization with over 8 decades of experience which spans institutional broking and corporate finance. The institutional broking division caters to domestic and foreign institutional investor, while the corporate finance division focuses on the niche areas of infrastructure, telecom and media. SSKI has been voted as the Top Domestic Brokerage House in the research category, by the Euro money survey and by the Asia money survey. 2. Defining a new paradigm in online trading. Among the pioneers in India, Sharekhan launched its online trading platform in February 2000. Since then Sharekhan has constantly monitored customer needs to be at the forefront of bringing innovations in its products so that they are customized to the habits traders as well as preferences of investors.

Key features:
Live streaming quotes Instant order execution and confirmation Price Alerts Single screen for equities and derivatives Multiple market watch windows Real time portfolio tracking.

3. Unwavering focus on the Science of Research While traditionally the markets have been known to react to tips, speculations and rumors Sharekhan believes that research and in-depth knowledge of markets can provide a better analysis. So, it has built a team of researchers and analysis who are

constantly at work to track performance and trends, to identify winners. A recent survey by The Economic Times reported that Sharekhan reigns over equity research. Other managed impressive 50% - 70% returns for their customers, but Share khans investment calls delivered a staggering 127% return.

Sharekhan Services:

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Types of Account:
1. ShareKhan Classic account: Allow investor to buy and sell stocks online along with the following features like multiple watch lists, Integrated Banking, demat and digital contracts, Real-time portfolio tracking with price alerts and Instant credit & transfer. o o o o o o o o o o Online trading account for investing in Equities and Derivatives Free trading through Phone (Dial-n-Trade) Two dedicated numbers for placing your orders with your cellphone or landline. Simple and Secure Interactive Voice Response based system for authentication get the trusted, professional advice from telebrokers. After hours order placement facility between 8.00 am and 9.30 am Integration of: Online trading + Demat account Instant cash transfer facility against purchase & sale of shares IPO investments Instant order and trade confirmations by e-mail Single screen interface for cash and derivatives Sharekhan Classic Terminal

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2. Sharekhan SpeedTrade Account: This accounts for active traders who trade frequently during the day's trading session. Following are few popular features of SpeedTrade account. o Single screen interface for cash and derivatives o Real-time streaming quotes with Instant order Execution & Confirmation o Hot keys similar to a traditional broker terminal o Alerts and reminders o Back-up facility to place trades on Direct Phone lines Sharekhan Speed Trade Terminal

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3. ShareKhan TradeTiger Account: o Trade Tiger is an application that brings you the power of a brokers terminal, right from your desktop. o Trade on multiple exchanges {NSE, BSE, MCX, NCDEX} from a single screen. o Customize market watches by scripts or sectors and view them on a single screen. o Get access to technical tools and trade like a pro. o This account allows you to trade through website and is suitable for retail investors This accounts for active traders who trade frequently during the days trading session. Following are few popular features of SpeedTrade account.

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Sharekhan TradeTiger Terminal

Dial and Trade: Free with your Sharekhan Classic Account, the Dial-n-Trade service enables you to place orders for buying and selling shares through your telephone. Simple and Secure Interactive Voice Response based system for authentication. No waiting time. Enter your TPIN to be transferred to our telebrokers. Toll free : 1-800-22-7050 Land Line : 30307600

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Online IPO:
Online IPO (Initial Public Offering) is a new service started by Sharekhan for providing the application form of any companys issues of shares just like the TCS issue can be subscribed by filling an online form to reduce the paper work and the fund transfer facility is also provided to the clients for transferring the funds online. It is given on its web-site for helping the clients who are not able to collect the forms manually and the speed of filling and reducing the risk of misplacing of forms, not reaching in time, etc.

Brokerage: Share khan in its online business charges brokerage as follows: In equity Market: On Trading: 0.1% On Delivery: 0.5% In Derivative Market On Trading: 0.12% (Total brokerage) On Delivery: 0.1% Service Tax 8% on Brokerage.

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Turnover tax + Stamp duty 0.015% (Rs. 15 on every turnover of Rs. 100000) Custody Charge Re. 1 per script held per month. Discounts For investors with High Net worth, there are slabs in brokerage rates. Payment Period The transaction settlement date in the securities market is T+ 2 days i.e. the payment of the transaction taken place has to be made within two days of its occurrence. Credit terms Share khan allows its customers to trade up to 4 times i.e. by keeping 1/4th margin with them for delivery and upto 10 times for intraday.

How to open account with Sharekhan ? For online trading with Sharekhan, investor has to open an account. Following are the ways to open an account with Sharekhan:
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Call them at phone number provided below and ask that you want to open an account with them.

a. Call on Toll free number: 1-800-22-7500 to speak to a Customer Service executive. b. You can also fill up your details in sharekhan online advertisement which is often placed in most of the websites. In reply their representative will be calling and assisting you for further process.
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Visit one of their branches. Sharekhan has a huge network all over India. Click on http://sharekhan.com/Locateus.aspx this link to find out your nearest branch. Just select the place near you and you'll find a manager to assist you there. You can send them an Email on info@sharekhan.com to know about their products and services.
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3.

4.

If you wish to chat with customer service representative, you can join the chat sesssion.

List of documents required to open an account: 1. Proof of Identity Copy of PAN Card (Mandatory) 2. Proof of Address Copy of any one of the following (Self Attested) Passport Ration card Voters ID Driving license Electricity bill (not more than 2 months old) Landline Telephone Bill (not more than 2 months old) Bank Pass Book 3. 2 Photographs 4. Margin cheque of minimum Rs.5000/5. A canceled cheque. Advantages of Sharekhan: 1. Account Opening at Sharekhan is FREE. 2. It comes along with free online trading account and demat account. 3. Account Maintanaince Charges (AMC) is FREE for the first year, from second year Rs.300/- p.a. 4. Online trading is very user friendly and one doesn't need any software to access. 5. They provides good quality of services like daily SMS alerts, mail alerts, stock recommendations etc.

6. Sharekhan has ability to transfer funds from most banks. Unlike ICICI Direct, HDFC Sec, etc., so investor not really needs to open an account with a particular bank as it can establish link with most modern banks.
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Disadvantages of Sharekhan:
1. They charge minimum brokerage of 10 paisa per stock would not let you trade stocks below 20 rs. (If you trade, you will loose majority of your money in brokerage). 2. Lots of hidden rules and charges. 3. They do not provide facility to book limit order trades during after-hours. 4. Classic account holders cannot trade commodities. 5. Cannot purchase mutual funds online. List of Banks currently supported by Sharekhan for online fund transfer Axis Bank Bank of india CITI Bank DEUTSCHE BANK HDFC Bank ICICI Bank IDBI Bank Indusind Bank Oriental Bank of Commerce Union Bank of India YES Bank

Useful links about ShareKhan/Contact Sharekhan at: 1. Email: info@sharekhan.com 2. FAQs: http ShareKhan Website: http://www.ShareKhan.com 3. Product Demo SpeedTrade: http://www.sharekhan.com/Demos/speedtrade/index.html 4. Product Demo - Classic: http://www.sharekhan.com/Demos/classic/index.html 5. http://sharekhan.com/KnowledgeCentre/Sharekhan_FAQ.aspx 6. Phone: 022-66621111 7. Toll Free: 1-800-22-7500
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INDUSTRY PROFILE

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THE INDIAN STOCK EXCHANGE Definition of a stock exchange: Stock exchange means any body or individuals whether incorporated or not, constituted for the purpose of assisting, regulating or controlling the business of buying, selling or dealing in securities. The securities include: Shares of public company. Government securities. Bonds. Meaning Of Stock Exchange: Stock markets refer to a market place where investors can buy and sell stocks. The price at which each buying and selling transaction takes is determined by the market forces (i.e. demand and supply for a particular stock). Let us take an example for a better understanding of how market forces determine stock prices. ABC Co. Ltd. enjoys high investor confidence and there is an anticipation of an upward movement in its stock price. More and more people would want to buy this stock (i.e. high demand) and very few people will want to sell this stock at current market price (i.e. less supply). Therefore, buyers will have to bid a higher price for this stock to match the ask price from the seller which will increase the stock price of ABC Co. Ltd. On the contrary, if there are more sellers than buyers (i.e. high supply and low demand) for the stock of ABC Co. Ltd. in the market, its price will fall down.

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History of Stock Exchanges:


The only stock exchanges operating in the 19 th century were those of Mumbai setup in 1875 and Ahmedabad set up in 1894. These were organized as voluntary nonprofit-marking associations of brokers to regulate and protect their interests. Before the control on securities under the constitution in 1950, it was a state subject and the Bombay securities contracts (control) act of 1925 used to regulate trading in securities. Under this act, the Mumbai stock exchange was recognized in 1927 and Ahmedabad in 1937. During the war boom, a number of stock exchanges were organized. Soon after it became a central subject, central legislation was proposed and a committee headed by A.D.Gorwala went into the bill for securities regulation. On the basis of the committees recommendations and public discussion, the securities contract (regulation) act became law in 1956.

Functions of Stock Exchanges:


Stock exchanges provide liquidity to the listed companies. By giving quotations to the listed companies, they help trading and raise funds from the market. Over the hundred and twenty years during which the stock exchanges have existed in this country and through their medium, the central and state government have raised crores of rupees by floating public loans. Municipal corporations, trust and local bodies have obtained from the public their financial requirements, and industry, trade and commerce- the backbone of the countrys economy-have secured capital of crores or rupees through the issue of stocks, shares and debentures for financing their day-to-day activities, organizing new ventures and completing projects of expansion, diversification and modernization. By obtaining the listing and trading facilities,
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public investment is increased and companies were able to raise more funds. The quoted companies with wide public interest have enjoyed some benefits and assets valuation has become easier for tax and other purposes.

The Indian Stock Exchange consist of two major exchanges in India that is: National Stock Exchange (NSE) and Bombay Stock Exchange (BSE)

NATIONAL STOCK EXCHANGE (NSE) : The National Stock Exchange of India Limited (NSE), is a mumbai - based stock exchange.It was incorporated in November 1992 as a tax-paying company. In April 1993, it was recognized as a stock exchange under the Securities Contracts (Regulation) Act, 1956. It provide facilities which serve as a model for the securities industry in terms of trading system, practises and procedure.It has been set up as public limited company owned by the leading financial institutions, banks, insurance companies and other financial intermediaries of india, but its management and ownership are separate entities. NSE is stock exchange in india where membership on an exchange also meant ownership of the exchange and management is under the control of Board of Directors.The day to day management of the Exchange is delegated to the Managing Director who is supported by a team of professional staff

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NSE Strong Points:


NSE uses satellite communication technology to energies participation from around 400 cities in India NSE the first exchange to trade ETFs(exchange traded funds) in India NSE can handle up to 1 million trades per day. It is one of the largest interactive VSAT based stock exchanges in the world. The NSE- network is the largest private wide area network in India and the first extended C- Band VSAT network in the world. Presently more than 9000 users are trading on the real time-online NSE application. In, march 2006, NSE had a market capitalization of 4,380,774 crore It covers more than 1500 cities across India NSE Deals With :

Equity Futures and Options Retail Debt Market Wholesale Debt Market NSE offers trading of a variety of types of securities, including equity, corporate debt, central and state government securities, commercial. NSE specializes in three market segments: wholesale debt, capital market (automated screen-based trading system), and futures and options (derivatives paper, and certificates of deposit). Branches of NSE located throughout the country, which gives flexibility to its member to transact from place of their own choice trough on-line screen operation and electronic clearing and settlement. It because of this reason NSE becomes the third largest stock exchange in the world in terms of volume of transaction.

BOMBAY STOCK EXCHANGE (BSE):


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Bombay stock exchange is one of the part of stock exchange market, it is established in the year 1875 and become the first stock exchange in the country to be recognized by government. It is the oldest stock exchange not only in the country but also in Asia. Its role is significant in the development of the capital market. In the past it was known as association of person (AOP), but now it is demutualized and corporatised entity incorporated under the provision of the companies act 1956, pursuant to the BSE(corporatisation and demutualization) scheme, 2005 notified by securities and exchange board of India (SEBI)

BSE Deals With :


Around 3,500 Indian companies listed with the stock exchange, and has a significant trading volume Exchange has a nation-wide reach with a presence in 417 cities and towns of India. BSE have an exclusive facility for financial training BSE Strong Points :

BSE provides an efficient and transparent market for trading in equity, debt instruments and derivatives. BSE is managed professionally by board of directors: highly profesionals, representatives of trading member and managing director BSE has online trading system known as BOLT BSE has made arrangement for a toll-free numbers which makes it easier for customers to contact. TOLL-FREE: 1600 22 6661 BSE recently created a history as its market capitalization crossed the $ 1000 billion mark. Todays Scenario :
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Bombay Stock Exchange sold a 5 percent stake to Singapore Stock Exchange for 1.89 billion India rupees, or $42.7 million, planning to capitalize on Singapore's position as a regional hub for derivatives and international listing The Bombay Stock Exchange has successfully deployed Oracle software, giving the exchange a single integrated system that should help streamline its financial accounting and human resource management processes.

REGIONAL STOCK EXCHANGES (RSE) OF INDIA :


The Regional Stock Exchanges in India started spreading its business operation from 1894. The first RSE to start its functioning in India was Ahmedabad Stock Exchange (ASE) followed by Calcutta Stock Exchange (CSE) in 1908. The stock exchange in India witnessed a flourishing phase in 1980s with the incorporation of many exchanges under it. In early 60s, it has only few certifies RSEs under it namely Hyderabad Stock Exchange, Indore Stock Exchange, Madras Stock Exchange, Calcutta Stock Exchange and Delhi Stock Exchange. The recent to join the list was Meerut Stock Exchange and Coimbatore Stock Exchange. Catalog of Regional Stock Exchanges in India Ahmedabad Stock Exchange Bangalore Stock Exchange Bhubaneshwar Stock Exchange Calcutta Stock Exchange Cochin Stock Exchange Coimbatore Stock Exchange Delhi Stock Exchange Guwahati Stock Exchange Hyderabad Stock Exchange Jaipur Stock Exchange Ludhiana Stock Exchange Madhya Pradesh Stock Exchange Madras Stock Exchange Magadh Stock Exchange Mangalore Stock Exchange
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Meerut Stock Exchange OTC Exchange Of India Pune Stock Exchange Saurashtra Kutch Stock Exchange Uttar Pradesh Stock Exchange Vadodara Stock Exchange

REGULATORY FRAME WORK OF STOCK EXCHANGE A comprehensive legal framework was provided by the Securities Contract Regulation Act, 1956 and Securities Exchange Board of India 1952. Three tier regulatory structure comprising Ministry of finance The Securities And Exchange Board of India Governing body

Members of the stock exchange: The securities contract regulation act 1956 has provided uniform regulation for the admission of members in the stock exchanges. The qualifications for becoming a member of a recognized stock exchange are given below:

The minimum age prescribed for the members is 21 years. He should be an Indian citizen. He should be neither a bankrupt nor compound with the creditors. He should not be convicted for fraud or dishonesty. He should not be engaged in any other business connected with a company. He should not be a defaulter of any other stock exchange. The minimum required education is a pass in 12th standard examination.

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SECURITIES AND EXCHANGE BOARD OF INDIA (SEBI)

The securities and exchange board of India was constituted in 1988 under a resolution of government of India. It was later made statutory body by the SEBI act 1992.according to this act, the SEBI shall constitute of a chairman and four other members appointed by the central government. With the coming into effect of the securities and exchange board of India act, 1992 some of the powers and functions exercised by the central government, in respect of the regulation of stock exchange were transferred to the SEBI.

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OBJECTIVES AND FUNCTIONS OF SEBI


To protect the interest of investors in securities. Regulating the business in stock exchanges and any other securities market. Registering and regulating the working of intermediaries associated with securities market as well as working of mutual funds.

Promoting and regulating self-regulatory organizations. Prohibiting insider trading in securities. Regulating substantial acquisition of shares and take over of companies. Performing such functions and exercising such powers under the provisions of capital issues (control) act, 1947and the securities to it by the central government.

SEBI GUIDELINES TO SECONDARY MARKETS: (STOCK EXCHANGES):

Board of Directors of Stock Exchange has to be reconstituted so as to include nonmembers, public representatives and government representatives to the extent of 50% of total number of members.

Capital adequacy norms have been laid down for the members of various stock exchanges depending upon their turnover of trade and other factors.

All recognized stock exchanges will have to inform about transactions within 24 hrs.

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FINANCIAL MARKETS AND THE IPO


The Financial Market is an amorphous set of players who come together to trade in financial assets. Financial Markets in any economic system that acts as a conduit between the organizations who need funds and the investors who wish to invest their money into profitable opportunity. Thus, it helps institutions and organizations that need money to have an access to it and on the other hand, it helps the public in general to earn savings. Thus they perform the crucial function of bringing together the entries who are either financially scarce or who are financially slush. This helps generally in a smoother economic functioning in the sense that economic resources go to the actual productive purposes. In modern economic systems Stock Exchanges are the epicenter of the financial activities in any economy as this is the place where actual trading in securities takes place.

Modern day Stock Exchanges are most of the centers to trade in the existing financial assets. In this respect, they have come a long way in the sense that these days, they act as a platform to launch new securities as well as act as most authentic and real time indicator of the general economic sentiment. The zone of activities in the capital market is dependent partly on the savings and investment in the economy and partly on the performance of the industry and economy in general. In other words capital market constitutes the channel through which the capital resources generated in the society and made available for economic development of the nation.

CAPITAL MARKET: Capital market is a place where we can raise long-term capital. Again the capital market is classified in to two types and they are Primary market and Secondary market. E.g.: Shares, Debentures, and Loans etc. PRIMARY MARKET:

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Primary market is generally referred to the market of new issues or market for mobilization of resources by the companies and government undertakings, for new projects as also for expansion, modernization, addition, diversification and up gradation. Primary market is also referred to as New Issue Market. Primary market operations include new issues of shares by new and existing companies, further and right issues to existing shareholders, public offers, and issue of debt instruments such as debentures, bonds, etc. The primary market is regulated by the Securities and Exchange Board of India (SEBI a government regulated authority). Function: The main services of the primary market are origination, underwriting, and distribution. Origination deals with the origin of the new issue. Underwriting contract make the share predictable and remove the element of uncertainty in the subscription. Distribution refers to the sale of securities to the investors. The following are the market intermediaries associated with the market: 1. Merchant banker/book building lead manager 2. Registrar and transfer agent 3. Underwriter/broker to the issue 4. Adviser to the issue 5. Banker to the issue 6. Depository 7. Depository participant Investors protection in the primary market: To ensure healthy growth of primary market, the investing public should be protected. The term investor protection has a wider meaning in the primary market. The principal ingredients of investors protection are:
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Provision of all the relevant information Provision of accurate information and Transparent allotment procedures without any bias.

SECONDARY MARKET The primary market deals with the new issues of securities. Outstanding securities are traded in the secondary market, which is commonly known as stock market or stock exchange. The secondary market is a market where scrips are traded. It is a market place which provides liquidity to the scrips issued in the primary market. Thus, the growth of secondary market depends on the primary market. More the number of companies entering the primary market, the greater are the volume of trade at the secondary market. Trading activities in the secondary market are done through the recognized stock exchanges which are 23 in number including Over The Counter Exchange of India (OTCE), National Stock Exchange of India and Interconnected Stock Exchange of India. Secondary market operations involve buying and selling of securities on the stock exchange through its members. The companies hitting the primary market are mandatory to list their shares on one or more stock exchanges in India. Listing of scrips provides liquidity and offers an opportunity to the investors to buy or sell the scrips. The following are the intermediaries in the secondary market: 1. Broker/member of stock exchange buyers broker and sellers broker 2. Portfolio Manager 3. Investment advisor 4. Share transfer agent 5. Depository Depository participants
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RESEARCH METHODOLOGY

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Research Methodology is a way to solve the problem scientifically and systematically. It includes not only the Research Methods but also the comparison of the logic behind the method we use in the context of our research study and explain why we are using a particular method and why not others. Methods of Data Collection: Primary Data: : This method includes the data collected from the personal interaction with authorized members of Sharekhan Securities limited. It is collected by Questionnaire and Personal Interviews. Secondary Data: The secondary source of data includes different websites of IPO which contains details which is helpful for making my project report.. Analysis of Data: The term analysis refers to the computation of certain measures along with searching for patterns of relationship that exist among data groups. Analysis Tools: Tabulation Graphs Pie charts

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THEORETICAL FRAMEWORK
IPO MARKET AT A GLANCE: When a company wants to go public, the first thing it does is hire an investment bank. A company could theoretically sell its shares on its own, but realistically, an investment bank is required - it's just the way SEBIs works. Underwriting is the process of raising money by either debt or equity (in this case we are referring to equity). One can think of underwriters as middlemen between companies and the investing public. The biggest underwriters are Goldman Sachs, Merrill Lynch, Credit Suisse First Boston, Lehman Brothers and Morgan Stanley. The company and the investment bank will first meet to negotiate the deal. Items usually discussed include the amount of money a company will raise, the type of securities to be issued, and all the details in the underwriting agreement. The deal can be structured in a variety of ways. For example, in a "firm commitment," the underwriter guarantees that a certain amount will be raised by buying the entire offer and then reselling to the public. In a "best efforts" agreement, however, the underwriter sells securities for the company but doesn't guarantee the amount raised. Also, investment banks are hesitant to shoulder all the risk of an offering. Instead, they form a syndicate of underwriters. One underwriter leads the syndicate and the others sell a part of the issue. Once all sides agree to a deal, the investment bank puts together a registration statement to be filed with the SEC. This document contains information about the offering as well as company info such as financial statements, management background, any legal problems, where the money is to be used, and insider holdings. The SEC then requires a "cooling off period," in which they investigate and make sure all material information has been disclosed. Once the SEC approves the offering, a date (the effective date) is set when the stock will be offered to the public. During the cooling off period the underwriter puts together what is known as the red herring. This is an initial prospectus containing all the information about the
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company except for the offer price and the effective date, which aren't known at that time. With the red herring in hand, the underwriter and company attempt to hype and build up interest for the issue. They go on a road show - also known as the "dog and pony show" - where the big institutional investors are courted. As the effective date approaches, the underwriter and company sit down and decide on the price. This isn't an easy decision: it depends on the company, the success of the road show, and most importantly, current market conditions. Of course, it's in both parties' interest to get as much as possible. Finally, the securities are sold on the stock market and the money is collected from investors.

SIGNIFICANCE OF STUDY: A Corporate may raise capital in the primary market by way of an IPO. IPO is the largest source of investment for the investors. IPO is the largest source of funds with long or indefinite maturity for the company. This study signifies the trends of IPO in India. This study signifies the how to choose an IPO. Financial and Capital Markets: A financial market is a place where financial instruments are exchanged. Financial market can be classified on the basis of the nature of instruments exchanged in the economy. Such instruments can broadly divided in two parts i.e. claim instruments and currency instruments. The subdivision of the major markets is shown in the following figure: Financial Market Securities Market Currency Market / Forex Market National Market International Market Domestic Market Foreign Market Capital Market Money Market Equity Market Debt Market Primary Market Secondary Market Spot Market Derivative Market Source: Investment Analysis & portfolio management M.Ranganathan & R.Madhumathi

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Securities Market: Securities are financial instruments that have been created to represent a legal obligation to pay a sum in future in return for the current receipts of value and the security market is a place or system where these securities are exchanged. Security market can be further divided into domestic and foreign market. 1. Domestic Market: Domestic market control exclusively to firms registered in a country. The countrys regulatory authority such as RBI and SEBI regulated the functioning of money market and capital market in domestic market. 2. Foreign Market: Due to globalization each nation also allows firms registered outside the country to participate in its economic activities for business expansion. These firms are controlled by the foreign segments. 3. Capital Market: Capital market claims both long term fixed claim securities and equity claim securities. Capital market composed all marketable securities which taken place into the market for the trading purposes. 4. Money Market: Money markets are short-term debt instruments market. Debt is a fixed income security and represents the borrowings of a market player. 5. Forex Market: The foreign exchange market is an international currency exchange market. It caters to the need of international mobility of funds. It exchanges the currency of one country to another country.
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6. Spot Market: Spot market denotes the current trading price of financial instruments. In the context of time, the spot market may range between one day, two days, or a week. 7. Derivative Market: The derivative market is a future market. Trade takes place here with the intention to settle it at a later date. The derivative market has forward, future, options or other derivative instruments trading. Capital Market is one of the most important segments of the Indian Financial System. It is the market available to the Companies for meeting their requirements of longterm funds. It refers to all the facilities and the institutional arrangements for borrowing and lending funds. In other words, it is concerned with the raising of money capital through long term investments. The demand for long term capital comes predominantly from private sector manufacturing industries, agriculture, and trade and Government agencies. While the supply of funds for the Capital Market comes largely from individuals and corporate savings, banks, insurance companies and other financing agencies and surplus government funds.

Capital Market: Primary Market Secondary Market Indian Capital Market is divided in further two parts: Gilt-edged Market A market for government and semi-govt. securities which is backed by the Reserve Bank of India. Industrial Securities Market It refers to the market which deals in the equities and debentures of corporate. It is further divided into two parts : Primary Market Deals with new securities. Secondary Market Buying and selling of securities of existing Cos.

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What are IPOs?


Primary Market is the door-way of corporate to enter in the Capital Market new issues / fresh / subsequent securities. It deals with the issue of new securities in terms of Equity shares, Preference shares, Debt Instruments, Central and state government projects, various public sector industrial units and post trusts etc. Primary market consists issue of securities to public which is popularly known as Initial Public Offers comes into the existence first time and fresh.

Regulatory Framework: In India Capital Market is regulated by the Capital Market division and Department of Economic Affairs, Ministry of Finance. It is responsible for: Institutional reforms in securities markets. Building regulatory and market institutions. Strengthening investor protection mechanism. Providing efficient legislative for securities markets. Securities and Exchange Board of India Act, 1992 is regulatory authority established under ( SEBI Act 1992 ) in order to protect the investors interest in securities as well as for the development of Capital Market. Some other laws are Securities Contracts (Regulation Act) 1956 and Depositories Act 1996. SEBI has a direct control on the securities of the corporate because it is necessary to be registered under the SEBI Act, governed by the government of India and fully supported by the RBI.

ISSUES IN PRIMARY MARKET: FINANCIALS OF IPOs Primarily, issues can be classified as a Public, Rights or preferential issues (also known As private placements). While public and rights issues involve a detailed procedure, private placements or preferential issues are relatively simpler. The classification of issues is illustrated below:
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Public issues can be further classified into Initial Public offerings and further public offerings. In a public offering, the issuer makes an offer for new investors to enter its shareholding family. The issuer company makes detailed disclosures as per the DIP guidelines in its offer document and offers it for subscription. The significant features and figure are showed below: Public Rights Issues Private Placement Preferential Issue Private Placement Initial Public Offerings Further Public Offerings Qualified Institutions Placement

Initial Public Offering (IPO) is when an unlisted company makes either a fresh issue of securities or an offer for sale of its existing securities or both for the first time to the public. This paves way for listing and trading of the issuers securities. Follow on public offering (FPO) is when an already listed company makes either a fresh issue of securities to the public or an offer for sale to the public, through an offer document. An offer for sale in such scenario is allowed only if it is made to satisfy listing or continuous listing obligations. Rights Issue (RI) is when a listed company which proposes to issue fresh securities to its existing shareholders as on a record date. The rights are normally offered in a particular ratio to the number of securities held prior to the issue. This route is best suited for companies who would like to raise capital without diluting stake of its existing shareholders unless they do not intend to subscribe to their entitlements. A preferential issue is an issue of shares or of convertible securities by listed companies to a select group of persons under Section 81 of the Companies Act, 1956 which is neither a rights issue nor a public issue. This is a faster way for a company to raise equity capital. The issuer company has to comply with the Companies Act and the requirements contained in Chapter pertaining to preferential allotment in SEBI (DIP) guidelines which inter-alias include pricing, disclosures in notice etc. Private placement is an issue of shares or of convertible securities by a company to a selected group of persons under Section 81 of the Companies Act, 1956 that is
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neither a rights issue nor a public issue. This is a faster way for a company to raise equity capital. A qualified institutions placement is a private placement of equity shares or securities convertible into equity shares by a listed company to Qualified Institutions Buyers.

Functionaries of an IPO: The functionaries in IPO are those concerned with the formation of joint stock companies and the issue of their securities to the public. Public issue is essentially an exercise involving active participation of number agencies. The promoter, as a principal representative of the company, which is making the public issue, should be clear in his mind about the number of agencies involved and their respective roles in the entire exercise so as to be able to coordinate effectively the efforts of these agencies. These functionaries are: Promoter Financial Publicity Advertising Others Brokers Bankers Govt. /Statutory Agencies Registrar Manager To The Issue

IPO ELIGIBILITY NORMS FOR MAKING THESE ISSUES: SEBI has laid down eligibility norms for entities accessing the primary market through public issues. There is no eligibility norm for a listed company making a rights issue, as it is an offer made to the existing shareholders who are expected to know their company. The main entry norms for companies making a public issue (IPO or FPO) are summarized as under:

Entry Norm I (EN I): The Company shall meet the following requirements:
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(a) Net Tangible Assets of at least Rs. 3 crores for 3 full years. (b) Distributable profits in at least three years (c) Net worth of at least Rs. 1 crore in three years (d) If change in name, at least 50% revenue for preceding 1 year should be from the new activity. (e) The issue size does not exceed 5 times the pre- issue net worth To provide sufficient flexibility and also to ensure that genuine companies do not suffer on account of rigidity of the parameters, SEBI has provided two other alternative routes to company not satisfying any of the above conditions, for accessing the primary Market, as under: Entry Norm II (EN II): (a) Issue shall be through book building route, with at least 50% to be mandatory allotted to the Qualified Institutional Buyers (QIBs). (b) The minimum post-issue face value capital shall be Rs. 10 crore or there shall be a compulsory market-making for at least 2 years OR Entry Norm III (EN III): (a) The project is appraised and participated to the extent of 15% by FIs/Scheduled Commercial Banks of which at least 10% comes from the appraiser(s). (b) The minimum post-issue face value capital shall be Rs. 10 crore or there shall be a compulsory market-making for at least 2 years. In addition to satisfying the aforesaid eligibility norms, the company shall also satisfy the criteria of having at least 1000 prospective allotters in its issue CATEGORY OF ENTITIES WHICH ARE EXEMPTED FROM THE AFORESAID: ELIGIBILITY NORMS: SEBI (DIP) guidelines have provided certain exemptions from the eligibility norms. The following are eligible for exemption from entry norms. (a) Private Sector Banks (b) Public Sector Banks
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(c) An infrastructure company whose project has been appraised by a PFI or IDFC or IL&FS or a bank which was earlier a PFI and not less than 5% of the project cost is financed by any of these institutions. (d) Rights issue by a listed company

SEBIS ROLE IN AN ISSUE:


Any company making a public issue or a listed company making a rights issue of value of more than Rs 50 lakhs is required to file a draft offer document with SEBI for its observations. The company can proceed further on the issue only after getting observations from SEBI. The validity period of SEBIs observation letter is three months only i.e. the company has to open its issue within three months period SEBI does not recommend any issue nor does take any responsibility either for the financial soundness of any scheme or the project for which the issue is proposed to be made or for the correctness of the statements made or opinions expressed in the offer document. It is to be distinctly understood that submission of offer document to SEBI should not in any way be deemed or construed that the same has been cleared or approved by SEBI. The Lead manager certifies that the disclosures made in the offer document are generally adequate and are in conformity with SEBI guidelines for disclosures and investor protection in force for the time being. This requirement is to facilitate investors to take an informed decision for making investment in the proposed issue. The investors should make an informed decision purely by themselves based on the contents disclosed in the offer documents. SEBI does not associate itself with any issue/issuer and should in no way be construed as a guarantee for the funds that the investor proposes to invest through the issue. However, the investors are generally advised to study all the material facts pertaining to the issue including the risk factors before considering any investment. They are strongly warned against any tips or news through unofficial means. DIP guidelines The primary issuances are governed by SEBI in terms of SEBI (Disclosures and Investor protection) guidelines. SEBI framed its DIP guidelines in 1992. Many amendments have been carried out in the same in line with the market dynamics and requirements. In 2000, SEBI issued Securities and Exchange Board of India (Disclosure and Investor Protection) Guidelines, 2000 which is compilation of all circulars organized in chapter forms. These guidelines and amendments thereon are issued by SEBI India
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under section 11 of the Securities and Exchange Board of India Act, 1992. SEBI (Disclosure and investor protection) guidelines 2000 are in short called DIP guidelines. It provides a comprehensive framework for issuances buy the companies. SEBI ensure compliance with DIP The Merchant Banker are the specialized intermediaries who are required to do due diligence and ensure that all the requirements of DIP are complied with while submitting the draft offer document to SEBI. Any non compliance on their part, attract penal action from SEBI, in terms of SEBI (Merchant Bankers) Regulations. The draft offer document filed by Merchant Banker is also placed on the website for public comments. Officials of SEBI at various levels examine the compliance with DIP guidelines and ensure that all necessary material information is disclosed in the draft offer documents. Central Listing Authority (CLA) & role of SEBI in the processing of Offer documents for an issue: The Central Listing Authoritys (CLA) functions have been detailed under Regulation 8 of SEBI (Central Listing Authority) Regulations, 2003 (CLA Regulations) issued on August 21, 2003 and amended up to October 14, 2003. In brief, it covers processing applications for letter precedent to listing from applicants; to make recommendations to the Board on issues pertaining to the protection of the interest of the investors in securities and development and regulation of the securities market, including the listing agreements, listing conditions and disclosures to be made in offer documents; and; to undertake any other functions as may be delegated to it by the Board from time to time. SEBI as the regulator of the securities market examines all the policy matters pertaining to issues and will continue to do so even during the existence of the CLA.

The CLA is not yet operational. Difference between an Offer Document, RHP, A Prospectus and an Abridged Prospectus Offer document means Prospectus in case of a public issue or offer for sale and Letter of Offer in case of a rights issue which is filed Registrar of Companies (ROC) and Stock
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Exchanges. An offer document covers all the relevant information to help an investor to make his/her investment decision. Draft Offer document means the offer document in draft stage. The draft offer documents are filed with SEBI, at least 21 days prior to the filing of the Offer Document with ROC/ SEs. SEBI may specifies changes, if any, in the draft Offer Document and the issuer or the Lead Merchant banker shall carry out such changes in the draft offer document before filing the Offer Document with ROC/SEs. The Draft Offer document is available on the SEBI website for public comments for a period of 21 days from the filing of the Draft Offer Document with SEBI. Red Herring Prospectus is a prospectus which does not have details of either price or number of shares being offered or the amount of issue. This is used in book building issues only. In the case of book-built issues, it is a process of price discovery and the price cannot be determined until the bidding process is completed. Hence, such details are not shown in the Red Herring prospectus filed with ROC in terms of the provisions of the Companies Act. Only on completion of the bidding process, the details of the final price are included in the offer document. The offer document filed thereafter with ROC is called a prospectus. Abridged Prospectus means the memorandum as prescribed in Form 2A under sub-section (3) of section 56 of the Companies Act, 1956. It contains all the salient features of a prospectus. It accompanies the application form of public. Lock-in Lock-in indicates a freeze on the shares. SEBI (DIP) Guidelines have stipulated lock-in requirements on shares of promoters mainly to ensure that the promoters or main persons, who are controlling the company, shall continue to hold some minimum percentage in the company after the public issue. Promoter definition The promoter has been defined as a person or persons who are in over-all control of the company, who are instrumental in the formulation of a plan or programmed pursuant to which the securities are offered to the public and those named in the prospectus as
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promoters(s). Itmay be noted that a director / officer of the issuer company or person, if they are acting as such merely in their professional capacity are not be included in the definition of a promoter. 'Promoter Group' includes the promoter, an immediate relative of the promoter (i.e. any spouse of that person, or any parent, brother, sister or child of the person or of the spouse). In case promoter is a company, a subsidiary or holding company of that company; any company in which the promoter holds 10% or more of the equity capital or which holds 10% or more of the equity capital of the Promoter; any company in which a group of individuals or companies or combinations thereof who holds 20% or more of the equity capital in that company also holds 20% or more of the equity capital of the issuer company. In case the promoter is an individual, any company in which 10% or more of the share capital is held by the promoter or an immediate relative of the promoter' or a firm or HUF in which the 'Promoter' or any one or more of his immediate relative is a member; any company in which a company specified in (i) above, holds 10% or more, of the share capital; any HUF or firm in which the aggregate share of the promoter and his immediate relatives is equal to or more than 10% of the total, and all persons whose shareholding is aggregated for the purpose of disclosing in the prospectus "shareholding of the promoter group"

Pricing Of an Issue Indian primary market ushered in an era of free pricing in 1992. Following this, the guidelines have provided that the issuer in consultation with Merchant Banker shall decide the price. There is no price formula stipulated by SEBI. SEBI does not play any role in price fixation. The company and merchant banker are however required to give full disclosures of the parameters which they had considered while deciding the issue price. There are two types of issues one where company and LM fix a price (called fixed price) and other, where the company and LM stipulate a floor price or a price band and leave it to market forces to determine the final price (price discovery through book building process). Fixed Price Offers An issuer company is allowed to freely price the issue. The basis of issue price is disclosed in the offer document where the issuer discloses in detail about the qualitative and quantitative factors justifying the issue price. The Issuer company can mention a price band of 20% (cap in the price band should not be more than 20% of
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the floor price) in the Draft offer documents filed with SEBI and actual price can be determined at a later date before filing of the final offer document with SEBI/Rocs. Price Discovery through Book Building Process Book Building method of IPO Book Building is basically a capital issuance process used in Initial Public Offer (IPO) which aids price and demand discovery. It is a process used for marketing a public offer of equity shares of a company. It is a mechanism where, during the period for which the book for the IPO is open, bids are collected from investors at various prices, which are above or equal to the floor price. The process aims at tapping both wholesale and retail investors. The offer/issue price is then determined after the bid closing date based on certain evaluation criteria. The Process: The Issuer who is planning an IPO nominates a lead merchant banker as a 'book runner'. The Issuer specifies the number of securities to be issued and the price band for orders. The Issuer also appoints syndicate members with whom orders can be placed by the investors. Investors place their order with a syndicate member who inputs the orders into the 'electronic book'. This process is called 'bidding' and is similar to open auction. A Book should remain open for a minimum of 5 days. Bids cannot be entered less than the floor price. Bids can be revised by the bidder before the issue closes. On the close of the book building period the 'book runner evaluates the bids on the basis of the evaluation criteria which may include Price Aggression Investor quality Earliness of bids, etc.

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The book runner and the company conclude the final price at which it is willing to issue the stock and allocation of securities. Generally, the number of shares is fixed; the issue size gets frozen based on the price per share discovered through the book building process. Allocation of securities is made to the successful bidders. Book Building is a good concept and represents a capital market which is in the process of maturing.
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Guidelines for Book Building:


Rules governing book building is covered in Chapter XI of the Securities and Exchange Board of India (Disclosure and Investor Protection) Guidelines 2000. BSE's Book Building System BSE offers the book building services through the Book Building software that runs on the BSE Private network. This system is one of the largest electronic book building networks anywhere spanning over 350 Indian cities through over 7000 Trader Work Stations via eased lines, VSATs and Campus LANS The software is operated through book-runners of the issue and by the syndicate member brokers. Through this book, the syndicate member brokers on behalf of themselves or their clients' place orders. Bids are placed electronically through syndicate members and the information is collected on line real-time until the bid date ends. In order to maintain transparency, the software gives visual graphs displaying price v/s quantity on the terminals. Initial Public Offerings: Corporate may raise capital in the primary market by way of an initial public offer, rights issue or private placement. An Initial Public Offer (IPO) is the selling of securities to the public in the primary market. This Initial Public Offering can be made through the fixed price method, book building method or a combination of both. In case the issuer chooses to issue securities through the book building route then as per SEBI guidelines, an issuer company can issue securities in the following manner: a. 100% of the net offer to the public through the book building route. b. 75% of the net offer to the public through the book building process and 25% through the fixed price portion.

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Price Band
The red herring prospectus may contain either the floor price for the securities or a price band within which the investors can bid. The spread between the floor and the cap of the price band shall not be more than 20%. In other words, it means that the cap should not be more than 120% of the floor price. The price band can have a revision and such a revision in the price band shall be widely disseminated by informing the stock exchanges, by issuing press release and also indicating the change on the relevant website and the terminals of the syndicate members. In case the price band is revised, the bidding period shall be extended for a further period of three days, subject to the total bidding period not exceeding thirteen days. Decision on the Price Band It may be understood that the regulatory mechanism does not play a role in setting the price for issues. It is up to the company to decide on the price or the price band, in consultation with Merchant Bankers. The basis of issue price is disclosed in the offer document. The issuer is required to disclose in detail about the qualitative and quantitative factors justifying the issue price. What is firm allotment? A company making an issue to public can reserve some shares on allotment on firm basis for some categories as specified in DIP guidelines. Allotment on firm basis indicates that allotment to the investor is on firm basis. DIP guidelines provide for maximum % of shares which can be reserved on firm basis. The shares to be allotted on firm allotment category can be issued at a price different from the price at which the net offer to the public is made provided that the price at which the security is being offered to the applicants in firm allotment category is higher than the price at which securities are offered to public. What is reservation on competitive basis? Reservation on Competitive Basis is when allotment of shares is made in proportion to the shares applied for by the concerned reserved categories. Reservation on competitive basis can be made in a public issue to the Employees of the company, Shareholders of the promoting companies in the case of a new company and shareholders of group companies in the case of an existing company, Indian Mutual Funds, Foreign Institutional Investors (including non resident Indians and overseas

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corporate bodies), Indian and Multilateral development Institutions and Scheduled Banks. Preference While Doing the Allotment The allotment to the Qualified Institutional Buyers (QIBs) is on a discretionary basis. The discretion is left to the Merchant Bankers who first disclose the parameters of judgment in the Red Herring Prospectus. There are no objective conditions stipulated as per the DIP Guidelines. The Merchant Bankers are free to set their criteria and mention the same in the Red Herring Prospectus. Who is eligible for reservation and how much? (QIBs, NIBs, etc.) A book built issue under entry Norm II shall offer not less than 50% to the QIBs and not less than 25% to the retail investors. The rest may be allotted to the Non Institutional buyers or High Net Worth individuals. RETAIL INVESTOR DEFINITION: Retail individual investor means an investor who applies or bids for securities of or for a value of not more than Rs.50,000.He can bid in a book-built issue for a value not more than Rs.50,000. Any bid made in excess of this will be considered in the HNI category. Online Bidding A company proposing to issue capital to public through the on-line system of the stock exchange for offer of securities can do so if it complies with the requirements under Chapter 11A of DIP Guidelines. The appointment of various intermediaries by the issuer includes a prerequisite that such members/registrars have the required facilities to accommodate such an online issue process. An investor may place his bids through the online terminals offered by some of the brokers. Demat Account As per the requirement, all the public issues of size in excess of Rs.10 crore, are too made compulsorily in the demat mode. Thus, if an investor chooses to apply for an issue that is being made in a compulsory demat mode, he has to have a demat account and has the responsibility to put the correct DP ID and Client ID details in the bid/application forms.
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The investor can change or revise the quantity or price in the bid using the form for changing/revising the bid that is available along with the application form. However, the entire process of changing of revising the bids shall be completed within the date of closure of the issue. The investor is entitled to receive a Confirmatory Allotment Note (CAN) in case he has been allotted shares within 15 days from the date of closure of the issue. The registrar has to ensure that the demat credit or refund as applicable is completed within 15 days of the closure of the issue. Open book/closed book Presently, in issues made through book building, Issuers and merchant bankers are required to ensure online display of the demand and bids during the bidding period. This is the Open book system of book building. Here, the investor can be guided by the movements of the bids during the period in which the bid is kept open. Under closed book building, the book is not made public and the bidders will have to take a call on the price at which they intend to make a bid without having any information on the bids submitted by other bidders.

Hard underwriting Hard underwriting is when an underwriter agrees to buy his commitment at its earliest stage. The underwriter guarantees a fixed amount to the issuer from the issue. Thus, in case the shares are not subscribed by investors, the issue is devolved on underwriters and they have to bring in the amount by subscribing to the shares. The underwriter bears a risk which is much higher in soft underwriting. Soft underwriting Soft underwriting is when an underwriter agrees to buy the shares at later stages as soon as the pricing process is complete. He then, immediately places those shares with institutional players. The risk faced by the underwriter as such is reduced to a small window of time. Also, the soft underwriter has the option to invoke a force Majeure (acts of God) clause in case there are certain factors beyond the control that can affect the underwriters ability to place the shares with the buyers. Cut Off Price In Book building issue, the issuer is required to indicate either the price band or a floor price in the red herring prospectus. The actual discovered issue price can be any price in the price band or any price above the floor price. This issue price is called
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Cut off price. This is decided by the issuer and LM after considering the book and investors appetite for the stock. SEBI (DIP) guidelines permit only retail individual investors to have an option of applying at cut off price.

Differential pricing Pricing of an issue where one category is offered shares at a price different from the other category is called differential pricing. In DIP Guidelines differential pricing is allowed only if the securities to applicants in the firm allotment category are at a price higher than the price at which the net offer to the public is made. The net offer to the public means the offer made to the Indian public and does not include firm allotments or reservations or promoters contributions. Basis of Allocation/Basis of Allotment After the closure of the issue, the bids received are aggregated under different categories i.e., firm allotment, Qualified Institutional Buyers (QIBs), NonInstitutional Buyers (NIBs), Retail, etc. The oversubscription ratios are then calculated for each of the categories as against the shares reserved for each of the categories in the offer document. Within each of these categories, the bids are then segregated into different buckets based on the number of shares applied for. The oversubscription ratio is then applied to the number of shares applied for and the number of shares to be allotted for applicants in each of the buckets is determined. Then, the number of successful allot tees is determined. This process is followed in case of proportionate allotment. In case of allotment for QIBs, it is subject to the discretion of the post issue lead manager.

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PERFORMANCE OF AN IPO:
Any analyst can refer to a company's fundamentals without actually saying anything meaningful. So what fundamentals are, how and why they are analyzed, and why fundamental analysis is often a great starting point to picking good companies. The Theory The goal of analyzing a company's Performance is to find a stock's 'intrinsic value', a term for what you believe a stock is really worth--as opposed to the value at which it is being traded in the marketplace. If the intrinsic value is more than the current share price, analysis is showing that the stock is worth more than its price and that it makes sense to buy the stock. Although there are many different methods of finding the intrinsic value, the premise behind all the strategies is the same: a company is worth the sum of its discounted cash flows. This means that a company is worth all of its future profits added together. And these future profits must be 'discounted' to account for the time value of money, that is, the force by which the $1 one receive in a year's time is worth less than $1 one receive today. The idea behind intrinsic value equaling future profits makes sense if one thinks about how a business provides value for its owner(s). If a small business, the worth of that business is the money one can take from the company year after year (not the growth of the stock). And one can take something out of the company only if you have something left over after you pay for supplies and salaries, reinvest in new equipment, and so on. A business is all about profits, which is the basis of intrinsic value. Discounted Cash Flow DCF A valuation method used to estimate the attractiveness of an investment opportunity. DCF analysis uses future free cash flow projections and discounts them to arrive at a present value, which is used to evaluate the potential for investment. Most often discounted by the weighted average cost of capital. If the value arrived at through DCF analysis is lower then the current cost of the investment, the opportunity may be a good one.

Basic Formula: DCF models are powerful but they do have shortcomings. DCF is merely a mechanical
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valuation tool. Small changes in inputs can result in large changes in the value of a company. Instead of trying to project the cash flows to infinity, a terminal value approach is taken in the valuation. A simple annuity is used to estimate the terminal value past 10. This is done because as time goes on, it is harder to come to a realistic estimate of the cash flows. One of the assumptions of the discounted cash flow theory is that people are rational, that nobody would buy a business for more than its future discounted cash flows. Since a stock represents ownership in a company, this assumption applies to the stock market. But still stocks exhibit volatile movements. It doesn't make sense for a stock's price to fluctuate so much when the intrinsic value isn't changing by the minute. The fact is that many people do not view stocks as a representation of discounted cash flows, but as trading vehicles. They dont care what the cash flows are if they can sell the stock to somebody else for more than what you paid for it. Cynics of this approach have labeled it the "greater fool theory," since the profit on a trade is not determined by a company's value, but about speculating whether one can sell to some other investor (the fool). On the other hand, a trader would say that investors relying solely on fundamentals are leaving themselves at the mercy of the market instead of observing its trends and tendencies. This debate demonstrates the general difference between a technical and fundamental investor. A follower of technical analysis is guided not by value, but by the trends in the market often represented in charts. Both fundamental and technical analysis has limitations. The answer is neither. As we mentioned in the introduction, every strategy has its own merits. In general, fundamental is thought of as a longterm strategy, while technical is used more for short-term strategies. Putting Theory into Practice The idea of discounting cash flows seems okay in theory, but implementing it in real life is difficult. One of the most obvious challenges is determining how far into the future one should forecast cash flows. It's hard enough to predict next year's profits, so it is difficult for one to predict the course of the next 10 years. What if a company goes out of business? What if a company survives for hundreds of years? All of these uncertainties and possibilities explain why there are many different models devised for discounting cash flows, but none completely escapes the complications posed by the uncertainty of the future.

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Qualitative Analysis Fundamental analysis has a very wide scope. Valuing a company involves not only crunching numbers and predicting cash flows but also looking at the general, more subjective qualities of a company. Management The backbone of any successful company is strong management. The people at the top ultimately make the strategic decisions and therefore serve as a crucial factor determining the fate of the company. To assess the strength of management, investors can simply ask the standard five W's: who, where, what, when, and why. Who? One should do some research, and find out who is running the company. Among other things, one should know who the company's CEO, CFO, COO, and CIO are. Then one can move onto he next question. Where? One need to find out where these people come from, specifically, their educational and employment backgrounds. One should find out if these backgrounds make the people suitable for directing the company in its industry. A management team consisting of people who come from completely unrelated industries should raise questions. If the CEO of a newly-formed mining company previously worked in the healthcare industry, small investors should find out whether he or she has the necessary qualities to lead a mining company to success. What and When? It is necessary to know what the management philosophy is. In other words, in what style do these people intend to manage the company? Some managers are more personable, promoting an open, transparent, and flexible way of running the business. Other management philosophies are more rigid and less adaptable, valuing policy and established logic above all in the decision making process. One can discern the style of management by looking at its past actions. One should ask himself if he agrees with this philosophy, and if he can see it working for the company, given its size and the nature of its business. Once one knows the style of the managers, it is now time to find out when this team took over the company. Jack Welch, for example, was CEO of General Electric for over 20 years. His long tenure is a good indication that he was a successful and profitable manager; otherwise, the shareholders and the board of directors wouldn't have kept him around. If a company is doing poorly, one of the first actions taken is
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management restructuring, which is change in management due to poor results. If one sees a company continually changing managers, it may be a sign to invest elsewhere. At the same time, although restructuring is often brought on by poor management, it doesn't automatically mean the company is doomed. For example, Chrysler Corporation was on the brink of bankruptcy when Lee Iacocca, the new CEO, came in and installed a new management team that renewed Chrysler's status as a major player in the auto industry. So, management restructuring may be a positive sign, showing that a struggling company is making efforts to improve its outlook and is about to see a change for the better. Why? A final factor to investigate is why these people have become managers. One should Look at the manager's employment history, and try to see if these reasons are clear. Does this person have the qualities needed to make someone a good manager for this company? Has he or she been hired because of past successes and achievements, or has he or she acquired the position through questionable means, such as selfappointment after inheriting the company? Know What a Company Does and How it Makes Money: A second important factor to consider when analyzing a company's qualitative factors is its product(s) or service(s). How does this company make money? What is the company's business model? Knowing how a company's activities will be profitable is fundamental to determining the worth of an investment. One of the biggest lessons taught by the dotcom bust of the late '90s is that not understanding a business model can have dire consequences. Many people had no idea how the dotcom companies were making money, or why they were trading so high. In fact, these companies weren't making any money; it's just that their growth potential was thought to be enormous. This led to overzealous buying based on a herd mentality, which in turn led to a market crash. But not everyone lost money when the bubble burst: Warren Buffet didn't invest in high-tech primarily because he didn't understand it. Although he was ostracized for this during the bubble, it saved him billions of dollars in the ensuing dotcom fallout. One needs a solid understanding of how a company actually generates revenue in order to evaluate whether management is making the right decisions.

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Industry/Competition
Aside from having a general understanding of what a company does, one should analyze the characteristics of its industry, such as its growth potential. A mediocre company in a great industry can provide a solid return, while a mediocre company in a poor industry will likely to cause loss. Market share is another important factor. One should look at how Microsoft thoroughly dominates the market for operating systems. Anyone trying to enter this market faces huge obstacles because Microsoft can take advantage of economies of scale. This does not mean that a company in a near monopoly situation is guaranteed to remain on top, but one should be careful about a risky venture. Barriers against entry into a market can also give a company a significant qualitative advantage. If compared, for instance, the restaurant industry to the automobile or pharmaceuticals industries. Anybody can open up a restaurant because the skill level and capital required are very low. The automobile and pharmaceuticals industries, on the other hand, have massive barriers to entry: large capital expenditures, exclusive distribution channels, government regulation, patents, and so on. The harder it is for competition to enter an industry, the greater the advantage for existing firms. Brand Name A valuable brand reflects years of product development and marketing. For example the most popular brand name in the world: Coca-Cola. Many estimate that the intangible value of Coke's brand name is in the billions of dollars! Massive corporations such as Proctor and Gamble rely on hundreds of popular brand names like Tide, Head & Shoulders. Having a portfolio of brands diversifies risk because the good performance of one brand can compensate for the lower performance of another. Assessing a company from a qualitative standpoint and determining whether one should invest in it are as important as looking at sales and earnings. This strategy may be one of the simplest, but it is also one of the most effective ways to evaluate a potential investment.

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The Concept of Technical Analysis With Reference To Initial Public Offerings Technical Analysis: Technical analysis is the polar opposite of fundamental analysis, which is the basis of every method explored so far in this tutorial. Technical analysts, or technicians, select stocks by analyzing statistics generated by past market activity, prices, and volumes. Sometimes also known as chartists, technical analysts look at the past charts of prices and different indicators to make inferences about the future movement of a stocks price. Philosophy of Technical Analysis: UNDERLYING THEORIES OF TECHNICAL ANALYSIS: Chart analysis (also called technical analysis) is the study of market action, using price charts, to forecast future price direction. The cornerstone of the technical philosophy is the belief that all factors that influence market price--fundamental information, political events, natural disasters, and psychological factors--are quickly discounted in market activity. In other words, the impact of these external factors will quickly show up in some form of price movement, either up or down. The most important assumptions that all technical analysis techniques are based upon can be summarized as follows: 1. Prices already reflect, or 'discount', relevant information. In other words, markets are efficient. 2. Prices move in trends. 3. History repeats itself. Technical analysis is a method of evaluating securities by analyzing statistics generated by market activity, past prices, and volume. Technical analysts do not attempt to measure a security's intrinsic value; instead they look for patterns and indicators on stock charts that will determine a stocks future performance. Technical analysis has become popular over the past several years, as more and more people believe that the historical performance of a stock is a strong indication of future performance. The use of past performance should not come as a big surprise. People using fundamental analysis have always looked at the past performance by comparing fiscal data from previous quarters and years to determine future growth. The difference lies in the technical analyst's belief that securities move with very predictable trends and patterns. These trends continue until something happens to change the trend, and until this change occurs, price levels are predictable.
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Pure technical analysts couldn't care less about the elusive intrinsic value of a company or any other factors that preoccupy fundamental analysts, such as managements, business models, or competition. Technicians are concerned with the trends implied by past data, charts, and indicators and they often make a lot of money trading companies they know almost nothing about. Technical Analysis as a Long-Term Strategy Technical analysts are usually very active in their trades, holding positions for short periods in order to capitalize on fluctuations in price, whether up or down. A technical analyst may go short or long on a stock, depending on what direction the data is saying the price will move. If a stock does not perform the way a technician thought it would, he or she wastes little time deciding whether to exit his or her position, using stop loss orders to mitigate losses. Whereas a value investor must exercise a lot of patience and wait for the market to correct its under valuation of a company, the technician must possess a great deal of trading agility and know how to get in and out of positions with speed. Support and Resistance Among the most important concepts in technical analysis are support and resistance. These are the levels at which technicians expect a stock to start increasing after a decline (support), or to begin decreasing after an increase (resistance). Trades are generally entered around these important levels because they indicate the way in which a stock will bounce. They will enter into a long position if they feel a support level has been hit, or enter into a short position if they feel a resistance level has been struck. Technicians have hundreds of indicators and chart patterns to use for picking stocks. However, it is important to note that no one indicator or chart pattern is infallible or absolute; the technician must interpret indicators and patterns, and this process is more subjective than formulaic. Technical analysis is unlike any other stock picking strategy--it has its own set of concepts, and it relies on a completely different set of criteria than any strategy employing fundamental analysis. However, regardless of its analytical approach, mastering technical analysis requires discipline and savvy, just like any other strategy. Some technical analysts claim they can be extremely accurate a majority of the time. There are many instances of investors successfully trading securities with only the knowledge of its chart and without even understanding what the company does. Technical analysis is a terrific tool, but most agree that it is much more effective when combined with fundamental analysis.

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TYPES OF INFORMATION REQUIRED TO ASSESS A COMPANYS IPO: The Initial Public Offering or IPO market as it is known, received a new lease of life in FY04- 05. With high profile issues like, NTPC and TCS opening at more than 3 and 10 times their issue price respectively, investors are flocking to the IPO market like never before. Companies, which had earlier shied away from the capital market, are now returning with a vengeance to satiate the appetite of investors. But one shouldnt just jump for an IPO as soon as it is announced. Here an attempt has been made to outline some issues that experts advice investors should look at before them making investment decision. Adequate research is, without a doubt, the most effective way to identify and stay away from the IPO disasters waiting to happen. The prospectus, which contains nearly all aspects of a company's business and game plan, is the first place any investor interested in purchasing a new issue should look. Before investing in an IPO, small investors are suggested by experts to run a check on the following factors: Lead Managers to the issue Second-tier investment banks -- Investment banks hired by a company to handle an IPO must do a fair amount of due diligence, so it's always comforting when the names on the front of a prospectus are well-known and well-regarded. Of course, even the best banks take out some turkeys. Plus, a number of small regional banks have solid reputations. The Lead Managers act as a catalyst as they attempt to bring in some credibility to the offer and their accountability is also very high. It is to be remembered that the lead managers credibility could act only as an indicator to the proposed issue, but does not assure success. There have been poor issues from good merchant bankers in the past. For the purpose of security, one can look for category one lead managers for judging the quality of the issue that includes DSP Merrill Lynch, HSBC Securities and Kotak Mahindra among others. Promoter holding in the company--- participation from financial institutions or a venture capital firm Issues where post-issue promoters holding is more than 80% may indicate a lack of liquidity in the stock since there are fewer shareholders trading fewer shares.
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One should be careful of companies that have issued shares on a preferential basis to promoters in high proportion, so as to increase their stake in the company. Also small investors should find out if this is an offer for sale or a genuine Initial Public Offering. In case of offer for sale, the issuing company may not benefit totally. Small investors should look for companies in which venture capital firms or financial institutions have participation or substantial interest. Also look for the shareholding pattern. This would indicate the risk profile of the company and the expectation of the institution from the company. In case of institution, look for nationalized banks and all India level financial institution such as ICICI, IFCI IDBI etc. Small investors should be careful of companies whose cost of project and means of finance have not been appraised by banks or financial institutions. Selling stockholders -- It's usually a bad sign when a large number of shares in an IPO come from selling stockholders, meaning pre-offering investors who are cashing out. Not only does it mean that the company won't receive the money from the sale of those shares, but it also should make one wonder why investors would want to sell their shares so quickly if a company's prospects are strong. In fact, investors usually prefer that management retain a sizable stake in the firm after the offering is completed. The number of selling stockholders is found in a section called "The Offering," while management's total stake can be found in "Principal and Selling Stockholders." Where is the company investing money? If the major portion of fund mobilized is being invested in land, buildings (the socalled green field issues), small investors should be careful. If the company is utilizing a portion of issue proceeds towards retiring high-cost debts, it would benefit the company in terms of lower interest outflow and therefore higher profitability. Also check the proportion of money that is being invested in new projects that it is venturing into. This would give some judgment on the estimated profitability of the company. If a company plans majority of the money to pay off debt or dole out a huge dividend to pre- IPO investors, watch out. That means people buying shares in the IPO are in essence paying for the company's past, not its future. Also be careful when a company says it's allocating most of the money for general corporate purposes. It's comforting if a company has more specific ideas about where your money will be invested -- acquisitions, advertising, capital formation, research and development, etc. Found in "Use of Proceeds

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Which sector does the company operate? What is the growth prospect of the sector ? The growth of the company in proportion to the growth of the market in which it operates has to be seen. Also small investors should look out for its market share or the projected market share vis--vis domestic competition. For example, figures of global software market or Indian software market do not indicate the exact future growth potential of the company since it is inclusive of all products and services. Export projection of the sector need not necessarily reflect the export potential of the company. See what the company is exporting and export income as a percentage of sales. Each sector has its own internal and external factors that influence the operation of the company. For example, software sector is vulnerable to high employee turnover. Promoters experience Whether the promoters have previous experience in transforming organizations from the grass root level in the same industry to a successful business? What is the experience they have in the sector the company is operating in or any other sector. Promoter experience is very crucial. Also small investors should check out the profitability of any subsidiary or affiliate company in which promoters has a stake or substantial interest. This would enable them to ascertain the managements efficiency in terms of managing organizations. Small investors should check for litigations against the promoters, nature of litigation and the promoters extent of liability, if any. Declining revenue -- If revenue for a company's most recent fiscal year is down from the year ago period, it may be time to run as far away as possible. Revenue for companies looking to go public should be growing rather significantly. Even slowing revenue growth is a warning sign. At the very least, read a company's explanation for the revenue slowdown, found later in the prospectus. Revenue totals can be found in "Summary Consolidated Financial Data" or "Selected Consolidated Financial Data." The explanation behind the results is found in "Management's Discussion and Analysis of Financial Condition and Results of Operations." Declining margins -- Along the same lines as declining revenue, declining operating margins are not a good sign. It means the company is becoming less and less profitable. However, if a company is in a fast-changing, highly competitive industry, it may need to sacrifice profitability for market share and brand equity. Again, read the explanation behind the shrinking margins. Margin totals found in "Summary
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Consolidated Financial Data" or "Selected Consolidated Financial Data." Explanation behind results can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations." Working capital deficit -- This is when a company's liabilities, or debts, are greater than its assets. This is not uncommon for a new issue, but it should be explained and should disappear on an "as adjusted" basis after the completion of the offering. Details can be found in "Summary Consolidated Financial Data" and an explanation is in "Liquidity and Capital Resources." Other financial red flags -- A number of other problems can be found on a company's balance sheet or income statement. Things such as inventories or accounts receivable rising more rapidly than revenue, high interest expenses, or extraordinary charges should be explained. Found in "Selected Consolidated Financial Data" with more detail in the "Index to Consolidated Financial Statements." Over-reliance on one customer -- A clear danger sign. Several IPOs have imploded after the companies announced they were losing one of their major customers. Of course, like all of these warning signs, there are exceptions. Found in "Risk Factors." Supplier reliance -- A company can be too reliant on its suppliers as well as its customers. Make sure a firm can switch from one supplier to another rather easily. Suppliers that double as competitors are another danger. Found in "Risk Factors." Competition -- Given that monopolies are illegal, competition will always be there, but you better watch out if some well-run, well-capitalized firms are on the list. One name that jumps quickly to mind: Microsoft. Found in "Risk Factors" and "Business." Other risk factors -- Patent disputes, heavy indebtedness, and litigation are just some of the other more dangerous risks. Read the entire "Risk Factor" section carefully, but don't get overly discouraged. Too-small pie -- No matter how effective a company is at selling widgets, there needs to be enough people willing to buy those widgets at high-enough prices. A company's target market should be large and rapidly growing. This information can be found in the "Business" section . Declining valuation -- Pre-offering an IPO be priced so they get a huge return on their initial investment, often as much as 10 times. You can find out what those
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original investors paid on average for their shares in the section entitled "Dilution." Compare that to the offering price. If the two prices are close, then one can bet preIPO investors at one point were too optimistic about the valuation for the company. While it may seem like a good deal to buy a company for about the same price as earlier investors, there's a reason for the lower valuation. On very rare occasions, IPO investors can actually pay less on average than the company's pre-offering backers Will the money invested yield maximum returns? Are the profit projections achievable? Small investors should ask these questions: What is the sales growth projected by the company vis--vis others in the sector and the industry growth rate? If the market is growing at 20%, it does not mean that the company would grow by 20%. Lets take a hypothetical example. X Company manufactures paints. Assume that the market is growing at 12% per annum. If sales of the company grew by, letssay 6%, it means that the company is growing at the rate of 0.5 x the industry growth. This would help small investors in ascertaining growth potential of the company. Are the margins projected comparable with other companies in the same sector? Are there any unusual costs or unusual rise in other income (recurring/nonrecurring)? Some companies show an unusual rise in their sales and net profits by 5-10 times. Justify this by comparing the sales growth figure. Small investors should check the competitive scenario of the industry. If the company is claiming that it is competing with e-enabled service providers, small investors should check out what type of e-enabling services they provide. Addressing competition at a macro level may reflect the exact picture.

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How do small investors justify the price of the issue? To justify pricing, Small investors should compare: The price to earnings ratio (this is price that the issue is offered upon earnings per share) which would throw light on the pricing of the issue. Operating margins (this is the income from operation less expenses from operation), Market capitalization (it is the number of share multiplied by the price at which it is offered) with the current companies in the sector that are listed in the market. Does the company enjoy tax benefits? Companies with foreign exchange earnings are entitled to certain exemptions. If the companys factory is in backward regions, they are entitled for subsidies as well as some tax exemptions. Lower incidence of tax benefits companies as their cash flows are increased to that extent. They may move the market; they may know the people who move the market (just to clarify institutions, not individuals, move the market). Experts are not saying short-term horizons are bad, but an individual investor should realize they are playing a tough game. It may be wise to set a longer time frame, find good companies, let the hedge funds obsess on quarterly fluctuations and wait for the market to recognize your good companies. Sometimes it happens sooner that one expects! At first glance, this fourth ingredient may sound like common sense, but far too often investors simply do not practice the risk-mitigation tactic of avoiding big mistakes. Somewhat instinctively, investors seem to hunt for big game defending against losses is, well, boring. But, if small investor can manage to avoid losses, he is really doing wonders for his average. Small investors should balance search for high-return stocks with a vigorous effort to identify red flags. Familiarize with the downside. This is harder because it is not as much fun as looking for growth. After small investor has found a company he thinks can be a great investment, you should resist the temptation to plunge ahead, and instead start to look for the companys potential difficulties. Develop a checklist of possible red flags and work down this list before every investment. If the red flags start to pile up, small investors should have to find the discipline to let the opportunity go, at least for the moment. One of the hardest things in investing is to find a company, get infatuated with it, get all geared up to buy the stock and then, upon discovering a big red flag, find that you have to take a pass. Small investors should be very careful about daily news. Most of it is noise. They need to ask themselves just one question about every piece of news regarding their
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potential investment: how does this news impact the fundamental prospects of this business? Most of the news that falls into their lap is suspect. All companies issue press releases that are understandably favorable. Much of the daily commentary that pushes through the media onto your television or newspaper is highly trendy commentators are finding patterns that do not really exist and turning tips into news flashes. All good investors get conditioned to be on the prowl for new information. However, on the flipside of this is the key skill is of tuning out noise disguised as useful information. The talking heads on cable television can seem dazzling as they rove from analyzing biotech to financials to transportation to technology. How can they be experts on so many subjects? Well, they arent. One starts to believe in an illusion when he thinks that he really knows his companies. All good investors want to know as much as possible about their investments, but a company is like an onion one can never fully peel. Every piece of information is valuable and if one has it, the odds are tilted a bit in his favor, enhancing the hedge against failure. But, remember, one reason making an educated investment based on incomplete information.

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SCOPE OF THE STUDY

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FINDINGS AND SUGGESTIONS

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After analyizing the financial position of SHAREKHAN limited evaluating its financial performance in respect of ratio analysis,the following conclusions is drawn from the study. On ipos the company shold suggest the demat account holders and the investors to knowing about the new stocks of issuing the ipos The new entrants of the stocks of high reputed companies shares can buy in the initial stage of the facevalue And every customer also watch the new stocks in the ipos websitem or in trade tiger During the study period the SHAREKHAN LIMITED is efficiently administering in controlling the operation expences.

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To study about the various functionaries and eligibility norms related to the IPOs. To know about the various statutory norms which requires for a new issues? To provide another better investment alternative to retail investor, rather than other investment instruments. To act as the decision support instrument while investing in IPO. Providing better understanding of stock market, another investment alternative, through IPO, among the investors. To determine the investors perspective and their responses towards I

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CONCLUSION
It has been concluded that the Sharekhan Securities is performing well when compared to other securities. The minimum investment required is also less i.e. Rs. 5, 000/- against other company securities. The Sharekhan Securities is offering highest returns when compared to other Securities Companies. Overall the

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Sharekhan has been performing well.And ipos role is very important . An (IPO) is the first sale of stock by a company to the public Broadly speaking, companies are either private or public Going public means a company is switching from private ownership to public ownership.

BIBLOGRAPHY

http://www.nseindia.com
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http://www.bseindia.com http://www.sharekhan.com http://www.investopedia.com http://www.google.com

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