MUMBAI: Most of the initial public offerings (IPOs) that had hit the capital market since 2012 have managed to hold on to their gains on the domestic bourses despite the steep corrections in the market during the past three weeks.Out of the 24 IPOs that had raised money from the public since January 2012, 17 IPOs are still trading with hefty gains with many of them trading with a premium of over 100 per cent to their issue price.
Experts said that the high quality of the companies is one of the main reasons why they are able to hold on to their gains despite a sharp correction in the secondary market. “It’s a combination of secondary market performance and how individual companies are performing. Always there are some companies which outperform the broader market through their superior performance,” said Pranav Haldea, managing director, Prime Database.
Mr Haldea also highlighted the role played by the Sebi in improving the quality of IPOs. “The stringent disclosure requirements to be followed by companies and the due diligence to be exercised, have all raised the quality of IPO’s that are hitting the market.“It's all a question of quality and the price at which the shares were allotted to investors,” said Jagannadham Thunuguntla, head of fundamental research at Karvy Stock Broking.
