I had linked earlier to a Bloomberg article which mentioned how the retail investor in India is pulling out of the Indian equity markets.
If further proof was needed, the IPO of Repco Home Finance provided it.
Typically, when markets are near new highs, we have retail investors making a beeline for IPOs wanting to flip it to make a quick buck.
The market sentiment is so negative amongst retail investors that nobody seems to be interested in IPOs.
Repco’s IPO was woefully under subscribed by retail investors-they subscribed to only 0.51 of the offered book.HNI’s only subscribed 0.37 times the book and employees subscribed by 0.57 times.
The book’s lead managers SBI Caps,IDFC and JM Financial appear to have done a woeful job in pricing the issue which had to be bailed out by institutional investors.
What is funny is the “Ra Ra” attitude of the Main Stream Media-an article in MoneyControl states that Repco IPO is fully subscribed without mentioning the dismal participation of the retail investors.
What I also find interesting was the “Subscribe at the Upper band” recommendation given by many august brokers/publications-Angel,Sharekhan, ICICI etc
Memo to investment bankers/brokerage houses:Better luck next time !!