IPO Rocket.com

Conchita asks:

Reliance Energy has gone all out to woo investors for the initial public offer (IPO) of its subsidiary, Reliance Power. It offered shares to retail investors at a 5% discount to the price band of Rs 405-450, and “staggered payment” option in this IPO.

Accordingly, retail investors need to pay only 25% of the total investment amount at the time of submitting the application and the rest at the time of allotment on first call,

This option brings a level playing field for retail investors vis-à-vis qualified institutional buyers(QIBs), who are allowed to bid in an IPO with just 10% margin while submitting the bids in a public issue. Prominent public issues, which enabled the staggered payment options in recent times include ICICI Bank and Reliance Petroleum.

In an IPO , for the retail investor there is an option where an applicant can withdraw their applications anytime before allotment of shares / securities by the company ,as there is a demand from the public to withdraw from the Reliance Power IPO , before its listed, seeing the adverse market situation.

According to SEBI Guidelines, in an IPO, companies invite applications for shares sought to be enlisted by them in a Stock Exchange. The subscription in an IPO can either through book-built process by inviting bids from the prospective investors or on a fixed price basis. Issue of securities in an IPO is, inter alia, governed by SEBI (Disclosures and Investors Protection) Guidelines, 2002 - popularly known as SEBI DIP Guidelines.

SEBI DIP Guideline at Para no 11A.7.7 also provides that an applicant can withdraw applications in a public issue. Thus, in a book-built issue the applicants can withdraw their applications anytime before allotment of shares / securities by the company. This is emanating from the fundamental principle under Law of Contracts that an offer can be revoked before acceptance. The bids made by the bidders (applicants) is an offer made and allotment of securities by the companies only brings into a binding contract between the bidder and the company and, therefore, an application in a public issue can be withdrawn by the applicant depending upon the market scenario post subscription/closure of the IPO but before allotment even if the application money has been realized by the company. However, as per Clause 11.3.4.1 of the SEBI DIP Guidelines, only Qualified Institutional Bidders (QIBs) are not allowed to withdraw their bid after the closure of the bid. This is to prevent any possible manipulation of the IPO subscription by the QIBs.

Instances have happened in our country where investors have withdrawn their applications in an IPO. IPO made by Purvankara Projects, Deccan Airlines, Cairn Energy, Housing Development Infrastructure Limited, IVR Prime, KPR Mills, have seen withdrawal of applications by retailers and HNI categories before allotment.

Camille asks:

New Delhi, It is not mere coincidence that the Bombay Stock Exchange catapulted

the Ambanis as the world’s richest having market capitalization of $

91 billion. This is certainly a moment of great pride for the nation

that was not too long back known as a land of snake charmers.

While the credit for changing the image goes to the IT sector, the

booming economy and with it the skyrocketing equity market, is doing

more than its bit to take the flying tricolour higher.

The latest bull run has seen the Sensex register 1000 point rise once

in 6 days and another as much rise in 2 days. The credit for the

spectacular rise goes largely to the ‘Reliance pack’— companies

belonging to the Mukesh and Anil Ambani group companies.ket

However, there’s more to it than meets the bull’s eye, pun intended.

While nobody can dispute a promoter’s desire to cash in on the booming

market, the way Anil Ambani has sought to ride roughshod over investor

interest may not pass muster with the capital market regulator

Securities and Exchange Board of India.

The case relates to the proposed initial public offering of his group

company and Reliance Energy Ltd.’s subsidiary, Reliance Power Ltd..

The company has already filed draft red herring prospectus with Sebi.

From the documents submitted to the regulator, one can clearly see

that Anil is trying to make personal gains at the cost of would be

investors of Reliance Power and the current shareholders of Reliance

Energy.

The DRHP says that Reliance Power is owned 50% by private companies of

Anil Ambani and the balance by Reliance Energy. Anil has contributed

10 bln rupees for his 50% stake.

The company is expected to raise 80 bln rupees via its 1.3-bln-share

IPO with the face value of each share being 2 rupees. Therefore, the

expected issue price per share is seen around 60 rupees.

At the issue price of 60 rupees, Reliance Power is worth 700 bln

rupees and Anil Ambani’s stake at 350 bln rupees, which has been

acquired for merely 10 bln rupees!

Also, according to clause 3.7.1 (i) of Sebi guidelines, a company

cannot make a public issue of 2 rupees face value share at a price

less than 500 rupees each.

Hence, in case Reliance Power issues the shares at a price of 500

rupees per share, Anil Ambani will gain upwards of 550 bln rupees at

the expense of future shareholders of Reliance Power.

What is also puzzling is why the group has ignored the 78-year-old

Reliance Energy for executing the prestigious ultra mega power

projects in the country.

Reliance Energy has been forced to transfer its huge resources in

terms of manpower and technical expertise to Reliance Power for the

UMPPs. The only argument that seems logical here is the personal gain

of Anil Ambani.

Little surprise. Sh Silvius Condapan, MP Rajya Sabha and Sh Baleshwar

Yadav, MP Lok Sabha have written to the Central Vigilance

Commissioner, the Finance Minister and to Sh. Prem Chand Gupta,

Minister for Corporate Affairs complaining against this malpractice.

Shelba asks:

Mumbai, India: Reliance Industries Limited (RIL) has sold 18.04 crore equity shares, representing 4.01% of the equity share capital of Reliance Petroleum Limited (RPL) out of its’ holding of 75%. The aggregate sale consideration is Rs4,023 crore.

After this sale, the shareholding of RIL in RPL is 70.99%.

RPL made an offering in May 2006 for 20% of its’ equity represented by 90 crore shares. This offering was the most successful IPO until then with overall demand exceeding USD 32 billion.

The sale of RPL shares was conducted by transactions through the Stock Exchanges and has helped to further broad base the shareholding pattern of RPL. The number of shareholders of RPL has increased from 12 lac shareholders at the time of IPO to 16 lac.

RPL is among the best performing stocks in the NIFTY index this year. It has, at current prices, provided a return of 250% to its investors since the IPO.

The sale of shares monetizes only a very small portion of RIL’s holding in RPL.

Reliance Industries Limited

Reliance Industries Limited (RIL) is India’s largest private sector company on all major financial parameters with turnover of Rs1,18,354 crore (US$ 27.23 billion), cash profit of Rs.17,678 crore (US$ 4.07 billion), net profit of Rs. 11,943 crore (US$ 2.75 billion) and net worth of Rs. 63,967 crore (US$ 14.72 billion) as of March 31, 2007.

RIL is the first and only private sector company from India to feature in the Fortune Global 500 list of ‘World’s Largest Corporations’ and ranks amongst the world’s Top 200 companies in terms of profits. RIL is amongst the 25 fastest climbers ranked by Fortune. RIL also features in the Forbes Global list of world’s 400 best big companies and in FT Global 500 list of world’s largest companies.

Reliance Petroleum Limited

Reliance Petroleum Limited (RPL), a subsidiary of RIL, is setting up a greenfield petroleum refinery and polypropylene plant in a Special Economic Zone at Jamnagar in Gujarat. With an annual crude processing capacity of 580,000 barrels per stream day (BPSD), RPL will be the sixth largest refinery in the world.

Catina asks:

US$ 4.72 billion in capital raised showing strong economic sentiment.

The Middle East markets raised US$ 4.72 billion from 13 IPOs in the second quarter of 2008 compared to US$ 3.9 billion in the same period in 2007.

The capital raised was 20% higher than amounts raised in the first quarter of 2008.

The figures were today announced by Ernst & Young today.

Saudi Arabia’s Al Inma Bank was the largest IPO in the Middle East in the second quarter of 2008 raising US$ 2.8 billion which amounted to 60% of the total funds raised.

Saudi Arabia’s Rabigh Refining and Petrochemical Company and Mobile Telecommunications Company Saudi Arabia combined accounted for 75% of the capital raised in the first quarter of 2008.

Other large IPOs in the region included Mohammad Al Mojil Group with US$559.94 million.

The UAE’s DEPA United Group raised US$432.3 million and was followed by two Egyptian companies - Palm Hills Developments with US$348.22 million and Maridive and Oil Services with US$272.93 million.

According to Azhar Zafar, Head of Mergers & Acquisitions, Ernst & Young Middle East, “There were 52 IPOs during 2007 and in the first half of 2008 there have been 26. The total capital raised in the first half of 2008 amounted to US$8.69 billion compared to US$4.83 billion from 33 IPOs during the same period last year.

The trend in the market is fewer but larger IPOs. IPOs continue to be oversubscribed in most instances, which reflects the continued appetite for IPOs in the market, for now.”

Phil Gandier, Head of Transaction Advisory Services for Ernst & Young Middle East, added, “although the drop in number and amount of capital raised in IPOs has been more severe in mature global markets, the region has shown some resilience as a result of liquidity created on the back of continuously increasing oil prices.

Less uncertainty in the East

Gandier said expectations for the rest of the year remain optimistic due to the large number of announced and to-be-announced IPOs. Companies that have either withdrawn or postponed their IPOs would revisit going public once they realize that market conditions in the Middle East region are less fraught with the uncertainty that is persisting in other regions.

Globally, the size of IPOs taken for two quarters on aggregate was roughly half as much as the 2007 while more IPOs have been postponed or withdrawn in the first six months of 2008 (177) than in all of 2007 (169).

In the second quarter of 2008, a total of 258 IPOs worldwide raised US$37.4 billion in capital. This compares with 247 IPOs worth US$41.2 billion in the previous quarter. However, compared with the same quarter in 2007, total capital raised fell by 59% (from US$90.4 billion to US$37.4 billion) and the number of deals more than halved (from 567 to 258). The BRIC states (Brazil, India, China and Russia) accounted for 76 deals worth $11.8 billion in the second quarter.

Emerging markets continued to drive activity in the second quarter with China leading the way in both value (US$6.2 billion) and volume (56 IPOs). Seven of the top 10 and 15 of the top 20 IPOs by capital raised were from emerging markets.

Four countries accounted for half of the capital raised globally: China (US$6.2 billion); Brazil (US$4.6 billion); United States (US$4.3 billion); and Saudi Arabia (US$3.4 billion). The most active countries in terms of number of deals were China (56); Poland (21); and Australia, South Korea and India (17).

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Nyla asks:

It is a testing time for the capital market regulator the Securities and Exchange Board of India. If it approves Reliance Power (RPL) Initial public offering (IPO) draft red herring prospectus (DRHP) in as is form than it will open the back door for unscrupulous promoters for asset striping and increasing their stake at the lower price while forcing other investors to invest in the company at higher prices. This will create imbalance in terms of risks associated with the investment in the IPOs. The public shareholders will face higher risk than promoters of the company.

The purpose of setting up of SEBI is to protect the interest of small investors. Hence the all the relevant SEBI guidelines and regulations are targeting at safeguarding the interest of small investors. If the RPL DRHP is cleared by SEBI without any changes, than it will create ripples in the capital market. Dubious promoters will line up to exploit the investors in Anil Ambani’s style.

The case in point is RPL who has filed its RHDP for the SEBI approval. The fine print of RPL DRHP prospectus draws attention at the dubious means adopted by Anil Ambani to transfer the various projects from Reliance Energy to Reliance Power and merging “dubba company” shell company called Reliance Public Utility Ltd (RPUL). Further the promoters of RPL are doing majority of investment at Rs. 2 per share where as the same shares will be offered to general public at Rs. 60 or at premium. If SEBI passes this RPL offer document in as is form than it will set wrong precedent in the market. The promoters will invest at lower price by merging shell companies and taking advantage of loopholes in the regulatory systems.

Anil Ambani, the promoters of RPL have to contribute in cash at the IPO price, so that the promoters take the same financial risk as the IPO investors.

The issue in reference is the minimum ‘promoters’ contribution’ to be brought in by the promoters - Reference clauses 4.1 to 4.6 of SEBI (Disclosure and Investor Protection) Guidelines, 2000. As per clause 4.1.1, the promoters shall contribute at least 20 per cent of the post issue capital, in a public issue by an unlisted company. As per clause 4.6.2, the promoters have to contribute this 20 per cent at least at the IPO price, if they have contributed this 20 per cent during one year preceding the public issue.

SEBI guidelines have been blatantly violated to perpetrate deception on the prospective investors in the IPO of Reliance Power Limited.

Anil Ambani decided to float an IPO of Reliance Power Limited in last week of July 2007. Without risking his money in the project, he still wants to retain majority control in Reliance Power.

To fulfill his greedy and malefied intention, the following modus operandi was carved. The Anil Dhirubhai Ambani Group a group had an existing shell company called Reliance Public Utility Private Limited (RPUPL). RPUPL, at that time, had a paid up capital of Rs 1.0 lakh. The authorized capital of RPUPL was increased to Rs 1000 crores by a resolution dated July 30, 2007. Anil Ambani’s personal investment company and Reliance Energy Ltd (controlled by him) invested Rs 500 crores each, in the equity share capital of RPUPL on August 3, 2007. RPUPL is still a shell company with just Rs. 1000 crores of share capital and Rs. 1000 crores investment (The Rs. 1000 crores investment will naturally be made only in Anil Ambani’s group of companies. Thus no money would have gone out of the group). Simultaneously, RPUPL and RPL boards passed the proposal for merger of RPUPL into RPL. Both the companies filed a scheme of amalgamation in the Bombay High Court in the first week of August 2007, that is, immediately after infusion of Rs 1000 crores in RPUPL. The rationale of the merger, as stated in the Scheme of Amalgamation was “RPUPL has put in considerable efforts in acquiring necessary technical and manpower skills which are ancillary to the business of RPL. RPL can take benefits of this specialised skill sets and technology available with RPUPL to undertake mega power project and implement them more efficiently and successfully,” (one is unable to understand how the shell company, having only Rs. 1 lakh capital till July 31, 2007, acquired the skill sets to implement a mega power projects. In fact Reliance Energy Ltd (REL), which the one of the largest power companies in India, was already a shareholder in Reliance Power and Reliance Energy’s technical experience have been used by Reliance Power to bag mega power projects.

The High Court of Bombay approved the merger on September 27, 2007. The order was filed with ROC on September 29, 2007, making the merger of RPUPL into RPL effective from that date. On September 30, 2007 RPL allots 250 crores shares of Rs. 2 each at par to AAA Project Venture Private Limited and REL, who are the erstwhile shareholders of RPUPL.

As a result of this ploy, Anil Ambani and REL both acquired, on September 30, 2007, 250 crores shares of Reliance Power each for a consideration of Rs. 1000 crores only. This was also infused into RPUPL only on August 3, 2007, within one year prior to public issue. These 250 crores shares of Reliance Power which, have been allotted to Anil Ambani’s personal investment company and REL pursuant to the amalgamation, apparently becomes eligible for exemption under clause 4.6.4 of SEBI (DIP) guidelines with respect to promoters contribution. Thus, Anil Ambani, as the promoter of Reliance Power, has avoided investing a huge amount as promoter’s contribution at the IPO price and passed on the entire risk of the project to the prospective investors to his personal gains.

It is apparent that the High Court was not aware of the ulterior motives behind the merger of RPUPL, a shell company into Reliance Power. The merger has been sanctioned by the High Court on the basis of the facts put before it and since the shareholders of both RTUPL and RPL would have approved the merger. The shareholders of both Reliance Power and RPUPL are Anil Ambani’s investment companies and a representative of Reliance Energy. Reliance Energy owns 50 per cent of Reliance Power. This merger proposal has never been taken to the shareholders of REL, who would have presumably questioned the need for and looked into the merits and demerits of the merger of a shell company into RPL.

Press reports state that Reliance Power plans to raise approximately Rs 8000 crores by issuing 130 crores equity shares of Rs 2 each. Thus the approximate issue price per equity share is expected to be Rs 60 per share. Ambani, as one of the promoters for his acquisition of 113 crores shares (10 per cent of post issue share capital as per the prospectus) at a price of Rs 50 per share, should have invested Rs 6780 crores. Against this, by misusing the exemptions in the SEBI guidelines intended for genuine merger, he has acquired this 10 per cent by spending only Rs 690 crores. In fact, the subscription by Ambani of 8 crore share at the IPO price is an eyewash to divert public attention.

Thus, at the expense of prospective investors, Ambani will gain approximately Rs 6000 crores (assuming the IPO price to be Rs 60 per share). In fact, as per clause 3.7.1 (i) SEBI guidelines, a company cannot make a public issue of Rs 2 face value share at the price less than Rs 500 each. Hence, in case Reliance Power issues the shares at the price of Rs 500 per share, Ambani will gain upwards of Rs 55,000 crores at the expense of the future investors of Reliance Power.

Thus the total loss to the prospective investors in Reliance Power will be Rs 12,000 crores (assuming IPO price to be Rs 60 per share). If the IPO price is Rs 500 as mandated by SEBI regulations, the loss to the prospective investors will be Rs 1,10,000 crores. In fact, the loss will be to the general public who will invest in the public issue, and also to the public financial institutions and banks, who will invest common man’s money in this public issue.

The above facts clearly point out a fraud being perpetrated on the investors and SEBI should immediately stop the public issue and not approve the prospectus. If SEBI approves this prospectus, it will be a disservice to the future investors in public issues and SEBI would not be discharging its responsibilities in a proper manner. It will set a dangerous precedent. From now on, every promoter in India would subvert SEBI (DIP) guidelines in the same manner. If SEBI approves this prospectus, they would be unable disapprove any public issue made in future, in the above manner. In fact, if this public issue is allowed, it may raise serious questions on the effectiveness of the regulatory framework of capital issues in Indian capital market.

To protect the interest of small investors and setting correct precedent that all are equal in the eyes of law, SEBI should ask Anil Ambani and REL to pickup entire stake in RPL at IPO price offered to other investors and thereby providing level playing field.

Further, in case of RPL it has not paid any consideration to Reliance Energy Ltd (REL) for acquiring all the projects awarded to latter. This means that the projects under RPL have no value, than why RPL planning to raise money through IPO at premium?

SEBI should look at all the irregularities and should come out with stringent action to set the correct precedent for the promoters and capital market participants that the law of the land is supreme.

Pearlie asks:

Singapore-based Ascendus India Trust has scored a major first by launching the first ever initial public offering (IPO) which raised funds on the Singapore Stock Exchange with the aim of owning real estate in India.

The IPO size was 500 million Singapore dollars while the offer price was 1.18 Singapore dollar, officials of JPMorgan, the sole financial advisor and joint bookrunner for the mega issue, said today.

In a presentation made to the media, Kaustubh Kulkarni, Executive Director, Real Estate, JPMorgan said Ascendus India Trust (AIT) was set up in Singapore “with the objective of owning income-producing real estate used primarily as business space in India”.

AIT’s initial portfolio comprises four world class business parks in three IT centres in India. It plans to grow organically and also through acquisitions.

The investors were indicated that they could expect an yield of 4.75 per cent in FY08 and 5.81 per cent in FY09 on their investment in AIT shares. Incidentally, the regulations there allow a company to indicate possible returns on investment.

Meanwhile, in a research study on real estate scenario in India, JPMorgan has said the industry is in the foothills of a sustained growth period. It expects the industry to grow from $50 billion in FY07 to $90 billion by FY11.

Referring to rising property prices, it said the prices seem to be at risk given concerns about rate hikes and potential oversupply. The study said the correction in certain micro markets cannot be ruled out but “we are still not in a bubble zone and that a bust is unlikely.

For more information on Real Estate Agents, MLS visit Propertiesmls.com

Source: IndiaRealEstateblog

Brittanie asks:

With the increase in personal wealth in Australia in recent times, many individuals who are classified as ‘wholesale’ or sophisticated’ investors, don’t even know it. More importantly they could be missing out on some investment opportunities simply because of their investor status.

Firstly, what exactly is a sophisticated or wholesale investor? Well, in the eyes of the Corporations Act 2001, a wholesale/sophisticated investor is someone who meets at least one of the following tests:-

• Has net assets of more than A$2.5m and supplies an Accountants Certificate confirming this

• Has income of at least A$250k over the last two financial years and supplies an Accountants Certificate confirming this

• Is investing $500k or more into the opportunity

If you don’t meet at least one of the above, you are deemed as a retail investor (unless you can meet one or more much more stringent tests which most investors would not qualify for).

So what is the advantage of being a wholesale investor? How does this help with your investing?

The answer is simply that in the eyes of the Corporations Act, someone who has met one of the above criteria, is more knowledgeable when it comes to investing. Therefore they can invest into pretty much anything.

There are quite a number of investment products that are only available to wholesale or sophisticated investors. The reason being that they are more complex that the average IPO or managed fund.

The other reason why these opportunities are only available wholesale investors, is because wholesale investors are exempt from the 20/12 rule. The 20/12 rule limits the number of retail investors who can invest into a particular opportunity to 20 within a 12 month period.

Usually there is no limit to the number of wholesale investors who can invest, which is why they are preferred by certain promoters of opportunities.

Also, the fact that wholesale investors can usually invest a larger amount of money makes them all the more attractive to promoters.

Some of the opportunities available to wholesale investors are:

Pre-IPO offers

This is where a company does a capital raising usually within about the last 12 to 18 months prior to going public. Shares are usually offered at a discount to the IPO price. These opportunities are available through certain brokers, investment banks and corporate advisory firms.

Private Placements

This is where a publicly listed company wants to raise more funds, usually for expansion or for an acquisition. Say they are raising $4m, rather than going to lots of small investors, they go to 8 wholesale investors who invest $500k each. This is a much easier and faster way of raising the capital. The benefit to the investor is that, in most cases, they receive their shares at a discount rate to the current trading price. Say the stock is trading at $1.00 on market. The private placement may be priced at $0.80. Meaning you make 20% return on day one.

Funds

There are certain funds that are only available to wholesale investors. Private Equity funds are one such example. They are specifically set up to accept money from high net worth individuals and institutional investors. These funds have a target IRR (Internal Rate of Return) of around 25% pa.

To learn more about wholesale or sophisticated investor opportunities, contact your stockbroker or private wealth manager. Alternatively you can establish a relationship with a investment banking or corporate advisory firm who specialises in wholesale opportunities.

© Len McDowall, Integral Capital Group 17th September 2007-09-17

Rosemarie asks:

 

2008 may be China’s year. Certainly having the eyes of the world on the country for 3 weeks of Olympic events hasn’t hurt. It also doesn’t hurt to have double-digit growth and a booming economy for the umpteenth year. And despite the global credit crunch, China appears to be undaunted and seems poised to continue its massive investment abroad. For as tourists and business interests flock to the East in search of new experiences and new markets, China is continuing its Journey to the West, by establishing an investment base in Europe for expansion into Africa, the Middle East and the rest of Europe.

 

Competition between New York, Europe and Asia for Chinese investment and Chinese IPOs has been fierce in recent years, after a long period when the U.S. market was the default choice for Chinese businesses. 2007 was a record-breaking year for Chinese IPOs in the United States, but since then initial public offerings from Chinese companies have virtually disappeared.

 

New stringent regulatory laws that make it harder for Chinese companies to pursue initial public offerings in the U.S. are partly to blame for this sudden change. And economic conditions in the U.S can also be blamed. But the aggressive campaigning of the London Stock Exchange (LSE) and other European markets for Chinese investment have also contributed to the shift.  An indication of the importance of Chinese Yuan was the establishment earlier this year of an LSE representative office in Beijing, a move which followed the openings of the New York Stock Exchange and The NASDAQ Stock Market offices in 2007.

 

The reason for this interest in Chinese investment?  The amount of money involved. Last year, $117.7 billion was raised on global equity markets by Chinese companies. That figure was second only to the United States. With Western companies fighting their way into the Chinese market, Chinese money is flowing out, providing an enticing incentive to markets around the world to battle for this capital.

 

While IPO’s are the main way Chinese businesses are establishing a foothold in Europe, other financial vehicles such as mergers and acquisitions and private partnering also contribute to the overall investment numbers.  Chinese investment in European projects has increased 500% since 2000, according to Ernst & Young China, and this increase encompasses both large and small-scale investment. While industries giants like China Telecom and Nanjing Auto grab the headlines, small and medium-sized enterprises are also joining the move to Old Europe.

 

With all of this capital flowing out of China, it’s no wonder that governments throughout Europe are doing everything they can to encourage Chinese IPOs and direct investment. The London government is even taking advantage of the link between the Beijing Games and the London Games in 2012 to encourage Chinese companies to move their European operations to the British capital. 

 

While London is the obvious leader in attracting Chinese investment, other European capitals are also seeing the benefits of increasing their economic partnership with China. Last year, trade between the EU and China topped  300 million, making the EU China’s largest trading partner. And French President Sarkozy’s  20 billion trade deal with China last year is a harbinger of future initiatives from European capitals.

 

Investing in Europe also makes sense for Chinese businesses and for the Chinese economy. In today’s increasingly multi-lateral world, diversification is both prudent and effective. And with the current state of the U.S. economy, China sees obvious benefits in pursuing investment in the EU. While the United States remains the world’s largest economy, the EU has stronger ties with Africa, Russia, and the Middle East and provides China with the perfect base to expand their investment into these regions.

 

So while the world looks East and focuses on China and the Olympic Games, it is increasingly clear that China’s Journey to the West will continue, with more and more Chinese businesses pursuing IPOs and making direct investments in the West. Helping and encouraging that investment is both an opportunity and a challenge for European governments and business interests. For in the early economic races of the 21st century, attracting Chinese investment is one of the global economy’s top prizes.

 

Didier J. Rault is Founder and Chairman of International Finance Capital, a Hong Kong and New York based company specializing in “West to East” and “East to West” investment.  www.ifc-group.com

 

Cassie asks:

Initial public offering (IPO), also referred to simply as a “public offering”, is when a company issues common stock or shares to the public for the first time. They are often issued by smaller, younger companies seeking capital to expand, but can also be done by large privately-owned companies looking to become publicly traded. Generally, the company offers primary shares this way, although sometimes secondary shares are also sold as IPOs.

IPOs generally involve one or more investment banks as “underwriters.” The company offering its shares, called the “issuer,” enters a contract with a lead underwriter to sell its shares to the public. The underwriter then approaches investors with offers to sell these shares. Enter Dynasty Resources, a small company with big ambitions for reshaping the way China and the US do business.

An initial public offering (IPO) occurs when a company first sells common shares to investors in the public. Generally, the company offers primary shares this way, although sometimes secondary shares are also sold as IPOs. For a company to offer IPOs, they need to hire a corporate lawyer as well as an investment banker to underwrite the offer. The actual sale of the shares is generally offered by stock exchange or by regulators. When the company starts to offer IPOs, they are usually required to reveal financial information about the company so that investors know whether the companies a good investment or not.

China is now the fourth largest economy in the world. There was substantial growth in market capitalization and trading activities in most of the major markets. The China Initial public offerings flood, which saw many deals massively oversubscribed by frenzied investors, appeared to be a major achievement of China’s financial reforms, for the first time making the stock market an important source of funding for many companies. Please visit online http://www.dynastyresources.net in NewYork city.

Cherish asks:

This list is not in any particular order. So choose what fits you and your investment style best and go with it. The purpose of this article is to highlight aggressive investments with high potential of huge returns. Of course you can get burned just as fast as you can get returns so be careful.

IPOs

I remember the first time I learned about IPOs. I was quite naive and thought I had it all figured out before throwing a lot of money on one IPO. As you probably already know, Chinese IPOs have been hot in recent years.

So I watched Chinese IPOs specifically for awhile before taking the big leap. I saw nothing but consistent high returns and had no reason to believe that the next Chinese IPO would be any different. However, it was different and I got burned.

I was quite confused but recovered and decided to try again on a different IPO. This time I gained back what I had lost and felt quite nice about it. So what did I learn? I learned that the market never really is predictable no matter how good past performance has been. I also learned that its better to be in with the underwriter instead of being an after market trader. With that being said most of us are not getting in on the bottom floor and I still know that there is plenty of money to be made with IPOs if done correctly.

Penny Stocks

Nothing is more risky and nothing has more quick profit potential than penny stocks. They are dangerous yet they are awesome. The uneducated person will simply call this type of investment gambling. Any kind of investment can be viewed this way without the right knowledge.

The difference between penny stocks and gambling is the type of information you are dealing with. If you are in the know as to what a companys new developments and progress is then you can time a penny stock investment just right.

There are many websites and forums dedicated to giving tip-offs before penny stocks go through the roof. Be careful though, sometimes these tip-offs are scams from people trying to pump and dump a stock, leaving you with the losses.

Also, dont be fooled by those extremely low priced shares, they can go lower believe it or not. However, if a stock is selling for $.01 a share and it goes up to $1 in a week, then you have just made a ton of money.

Follow the Stock Promoters

The third way to make some quick money in the stock market is to get in on a stock before they launch a big promotional campaign. As soon as a stock gets more exposure the price per share typically goes up. So find out who the stock promoters are and then find out what they are promoting next. Sounds easy enough right?

Well, often they are like the stocks themselves and you must constantly be in the know of what is next. There are several paid services out there on the internet dedicated to sending out email updates on whats the next stock to be promoted.

If you are looking to making some quick money in the stock market then these are best ways to do it. There of course is ton risk involved in fast money investments.

If you have the extra funds and a high risk tolerance then give one or more of these methods a try. Never invest more money than you are willing to completely lose.