What is green shoe options and why it is called like that? Similarly what is green field project?
Is There Still Enough Appetite for Ipos ?
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into a binding contract between the bidder and the company and, therefore, an application in a public issue can be withdrawn by the applicant depending upon the market scenario post subscription/closure of the IPO but before allotment even if the application money has been realized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.
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.
Ada Celebrates His Wealth on the Tunes of Nero
Marceline asks:
ADA throws party tonight to celebrate success of IPO and successfully proves himself as modern version of the Rome king- Nero.
When Rome was burning! There is an ancient story on how Nero- the king played fiddle – a musical instrument while the Rome was burning. Something similar happened today.
ADA rang the bell in morning to list his IPO and Indian investors who participated in large numbers to subscribe Reliance Power issue were crying whole day. More than 50 Lakh investors participated in this historic Initial Public Offer at the last count.
One should also not overlook the fact that the largest public issue in Indian stock market history also created records for over subscriptions.
However, when it got listed today, investor lost unparalleled wealth. At the last count, more than 17%. When the stock market closed, Reliance Power IPO closed at 372 compared to the issue price of Rs. 450. It has never happened in the history of Reliance group.
However, what is more surprising is that the promoter’s, Mr. Anil Ambani’s wealth increased by almost Rs. 38,000 crore. Mr. Ambani currently owns 45% of the Reliance Power in his personal companies and has invested at Rs. 10 per share in the company compared to other investors from whom they have taken Rs. 450 per share. Even at 372, he has generated a profit for himself of Rs. 272 per share. Can one beat it? When the entire stock market is burning, the Nero is enjoying.
To celebrate this unparalleled personal wealth creation, he arranged a party on Monday evening at his multistoried residence Sea Wind. The party was held at the 5th floor swimming pool side. The top cabinet of Mr. Ambani along with the merchant bankers, investment bankers, private equity types, movie stars and several dignitaries attended this party to celebrate the great success of Reliance Power IPO although more than 50 lakh investors have lost more than 17% of their wealth in this much hyped IPO which has brought bad name to the house of Reliance. Wine, whisky and seven star catering adorned the menu in the glittering ceremony.
This reminds one of Nero playing the fiddle while Rome kept on burning. However, here, there is a reason. Mr. Ambani benefited immensely although small investors lost. However, who cares for small investors in India?
ADA throws party tonight to celebrate success of IPO and successfully proves himself as modern version of the Rome king- Nero.
When Rome was burning! There is an ancient story on how Nero- the king played fiddle – a musical instrument while the Rome was burning. Something similar happened today.
ADA rang the bell in morning to list his IPO and Indian investors who participated in large numbers to subscribe Reliance Power issue were crying whole day. More than 50 Lakh investors participated in this historic Initial Public Offer at the last count.
One should also not overlook the fact that the largest public issue in Indian stock market history also created records for over subscriptions.
However, when it got listed today, investor lost unparalleled wealth. At the last count, more than 17%. When the stock market closed, Reliance Power IPO closed at 372 compared to the issue price of Rs. 450. It has never happened in the history of Reliance group.
However, what is more surprising is that the promoter’s, Mr. Anil Ambani’s wealth increased by almost Rs. 38,000 crore. Mr. Ambani currently owns 45% of the Reliance Power in his personal companies and has invested at Rs. 10 per share in the company compared to other investors from whom they have taken Rs. 450 per share. Even at 372, he has generated a profit for himself of Rs. 272 per share. Can one beat it? When the entire stock market is burning, the Nero is enjoying.
To celebrate this unparalleled personal wealth creation, he arranged a party on Monday evening at his multistoried residence Sea Wind. The party was held at the 5th floor swimming pool side. The top cabinet of Mr. Ambani along with the merchant bankers, investment bankers, private equity types, movie stars and several dignitaries attended this party to celebrate the great success of Reliance Power IPO although more than 50 lakh investors have lost more than 17% of their wealth in this much hyped IPO which has brought bad name to the house of Reliance. Wine, whisky and seven star catering adorned the menu in the glittering ceremony.
This reminds one of Nero playing the fiddle while Rome kept on burning. However, here, there is a reason. Mr. Ambani benefited immensely although small investors lost. However, who cares for small investors in India?
