For Quick Alerts
ALLOW NOTIFICATIONS  
For Daily Alerts

    Investors Won't Return If They Lose Money In Primary Market: Sinha

    By Super
    |

    Mumbai, Dec 15 (PTI) Attributing better performance of recent IPOs to easier norms, Sebi Chairman U K Sinha today said retail investors may not invest again if they lose money in the primary market.

    Investors Won't Return If They Lose Money In Primary Market: Sinha
     

    "If retail investors feel they are continuously losing money in the primary market by subscribing to IPOs, they may not invest again," Sebi Chairman U K Sinha told an investment bankers' summit here.

    Notably, the IPO market has seen a boom this year after a near-drought situation in the past five years. Companies like, InterGlobe, CCD, Alkem and Dr LalPath Labs, among others got tremendous response to their issues this year.

    While most of the new issues of the past many years have been trading below the issue price, 56 per cent of the IPOs this year are trading above the issue price.

    Attributing the better performance of the new issues partly to enabling regulations in the IPO market, such as reduced time to process and clear DRHPs, Sinha said the new IPO norms will be effective from January 1.

    "If you look at data, the time taken by Sebi in examining and issuing observations on IPOs has come down by half now. Part of the reason for the delay in the past was that Sebi had proposed safety net for retail investors in the IPOs," he said.

    "If you look at data prior to 2013, more than two-thirds of the new issues were trading below issue price. Obviously, it had impact on investors.

    But I am happy that IPOs that have come this year, 56 per cent are trading above the issue price," the Sebi chief said.

    On the IPO market, he said the total primary issues in FY15 were worth Rs 9,700 crore, but this fiscal it is Rs 18,300 crore, out of which Rs 16,150 crore would come from sectors such as healthcare, education, hotel and restaurants, while there are no issues from banks, and power companies which have been traditionally active.

     

    He also said the regulator has taken up with Reserve Bank and the banking lobby Indian Banks Association to train bankers on ASBA so that retail investors' money is not blocked indefinitely by participating in IPOs.

    On the proposed exit options and convertible issues, he expressed hope that comments from the public and other stakeholders would be in place soon so that Sebi could issue the final guidelines soon. "Our intent is to implement these norms early as possible," he said.

    PTI

    Read more about: investors
    Company Search
    Enter the first few characters of the company's name or the NSE symbol or BSE code and click 'Go'

    Find IFSC

    We use cookies to ensure that we give you the best experience on our website. This includes cookies from third party social media websites and ad networks. Such third party cookies may track your use on Goodreturns sites for better rendering. Our partners use cookies to ensure we show you advertising that is relevant to you. If you continue without changing your settings, we'll assume that you are happy to receive all cookies on Goodreturns website. However, you can change your cookie settings at any time. Learn more