Where is IPO Market
Content
Observations:
1. The ongoing turmoil in capital markets has been impacting IPO markets severely. The bad mood of capital markets have led 25 companies to call-off their IPOs during this 2011 calendar year. The probable amount that these 25 companies were planning to raise was to an aggregate of Rs 31,000 Crores. 2. All these 25 companies had valid SEBI approval in hand for their IPOs. Even then, couldn’t open their IPOs within the validity period of one year from the date of SEBI approval. 3. Of these 25 companies, the list was largely featured with real estate companies and power companies. The list of real estate companies that called off IPOs include Lodha Developers, Ambiance Real Estate, Kumar Urban Developers, Neptune Developers, BPTP, Raheja Universal and Lavasa Corporation. The list of power companies that called off IPOs include Sterlite Energy, Jindal Power, Avantha Power and IND Bharat Power Infra. Other major companies include Reliance Infratel, Glenmark Generics, Gujarat State Petro Corp, One97 Communications. 4. Besides these companies, few companies have already announced IPO deferrals even though approval for SEBI validity for their IPOs still remain. For instance, Micromax has already annoucned IPO deferral, owing to the market conditions.
5. Further, there are atleast 10 other companies who have valid SEBI approval in hand and are left with just 2 months in their validity period of one year from the date of SEBI approval. Such companies include Pride Hotels, Tara Jewels, etc. 6. This surely will impact the Indian corporate's ability in fund raising to finance their expansion projects resulting in slow down in capacity building and job creation. 7. Further, this trend in IPO market will surely set panic in the minds of the Private Equity (PE) funds, as they will be unable to exit from their investments as they generally invest in unlisted companies in the hope of exiting through IPOs. Some such companies are Lavasa Corporation (the investors were Axis Bank, ICICI Bank), BPTP Limited ( the investor was JP Morgan ( through Harbour Victoria Investment), One97 communications (the investors were SAIF Partners, Intel Capita, Silicon Valley Bank, SAP Ventures), Micromax (the investors were TA Associates, Sequoia Capital India, Sandstone Capital, Madison India Capital), You Broadband (the investors was CVC), Avantha Power (the investor was KKR), IND Barath Power (the investors were CVC, Sequoia Capital, Bessemer Venture Partners, UTI Ventures) etc.
8. Further, the government's disinvestment program which was supposed to bring public issues of several blue-chip PSUs couldn’t take off. If the government is not getting enough confidence to bring FPO for ONGC, how will the promoters of any smaller companies stick their necks out? This is surely impacting the confidence of the promoters of the smaller companies. 9. From the retail investors point of view, the long-awaited money-making IPO dream is remaining to be just a dream. Jagannadham Thunuguntla Strategist & Head of Research, SMC Global Securities Limited Contact Number: +91 9711424809
Prospectuses for which SEBI Clearance Received Indicative IPO size Valid Till (Rs. Crores)
Sr. No. 1 2 3 4 5 6 7 8 9 10
Company
Approval Date
Status
Reliance Infra Tel Limited Lodha Developers Limited AMR Constructions Limited PNC Infratech Limited Ambiance Limited PCI Limited Ankita Knitwear Limited Glenmark Generics Limited Kabirdass Motor Company Limited Kumar Urban Development Limited
11-Jan-10 21-Jan-10 29-Jan-10 2-Feb-10 4-Feb-10 19-Feb-10 26-Feb-10 8-Mar-10 9-Mar-10 22-Mar-10
11-Jan-11 20-Jan-11 28-Jan-11 1-Feb-11 3-Feb-11 18-Feb-11 25-Feb-11 7-Mar-11 8-Mar-11 21-Mar-11
5000.00 2500.00 145.28 175.00 1293.00 48.46 25.00 570.00 60.00 320.00
Expired Expired Expired Expired Expired Expired Expired Expired Expired Expired
11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36
Sterlite Energy Ltd Neptune Developers Limited BPTP Limited Gujarat State Petroleum Corporation Limited. Asian Business Exhibition & Conferences Ltd Jindal Power Limited Avantha Power & Infrastructure Limited ICOMM Tele Ltd Virgo Engineers Limited Raheja Universal Ltd. Sel Textile Limited Greatship (India) Limited IND-Barath Power Infra Limited One 97 Communications Limited Lavasa Corporation Limited Sumatex Limited You Broadband & Cable India Ltd Endurance Technologies Limited AGS Transact Technologies Limited Tara Jewels Limited Pride Hotels Limited Micromax Informatics Limited Betul Oil Limited Marck Biosciences Limited Tijaria Polypipes Limited Tara Health Foods Limited Total probable fund raising through IPO
5-Apr-10 29-Apr-10 3-May-10 10-May-10 14-May-10 28-May-10 6-Aug-10 13-Aug-10 1-Sep-10 3-Sep-10 9-Sep-10 6-Oct-10 11-Oct-10 25-Oct-10 11-Nov-10 1-Dec-10 13-Dec-10 14-Dec-10 31-Dec-10 4-Jan-11 13-Jan-11 14-Jan-11 19-Jan-11 2-Feb-11 8-Feb-11 9-Feb-11
4-Apr-11 28-Apr-11 2-May-11 9-May-11 13-May-11 27-May-11 5-Aug-11 12-Aug-11 31-Aug-11 2-Sep-11 8-Sep-11 5-Oct-11 10-Oct-11 24-Oct-11 10-Nov-11 30-Nov-11 12-Dec-11 13-Dec-11 30-Dec-11 3-Jan-12 12-Jan-12 13-Jan-12 18-Jan-12 1-Feb-12 7-Feb-12 8-Feb-12
3000.00 Expired 378.16 Expired 1500.00 Expired 3067.16 Expired 79.41 Expired 7200.00 Expired 1250.00 Expired 200.00 Expired 340.50 Expired 864.00 Expired 102.16 Expired 328.35 Expired 1140.00 Expired 120.00 Expired 1663.31 Expired 38.24 360.00 460.00 170.00 50.00 125.00 426.04 IPO Deferred 100.00 55.34 110.00 160.00 33,424.41
Thank You
SMC Global Securities Limited Corporate Office 11 / 6 B, Ground floor, Shanti Chambers, Pusa Road New Delhi - 110005 INDIA Tel: +91 011 2582 6706/ 2586 3648 Fax: +91 11 2586 3606 www.smcindiaonline.com Contact: Jagannadham Thunuguntla, Strategist & Head of Research Mobile: +91 97114 24809, +91 96509 88002, +91 93120 63677 E-mail: [email protected] Disclaimer : This report is for information purposes only. Due care has been taken in compilation of the report to ensure that the information is accurate to the best of our knowledge and belief. The information contained in the report has been obtained from reliable and publicly available sources. SMC Global Securities Ltd, makes no representations or warranties regarding the accuracy or completeness of such information and expressly disclaims any and all liabilities based on such information or on omissions there from.
1. The ongoing turmoil in capital markets has been impacting IPO markets severely. The bad mood of capital markets have led 25 companies to call-off their IPOs during this 2011 calendar year. The probable amount that these 25 companies were planning to raise was to an aggregate of Rs 31,000 Crores. 2. All these 25 companies had valid SEBI approval in hand for their IPOs. Even then, couldn’t open their IPOs within the validity period of one year from the date of SEBI approval. 3. Of these 25 companies, the list was largely featured with real estate companies and power companies. The list of real estate companies that called off IPOs include Lodha Developers, Ambiance Real Estate, Kumar Urban Developers, Neptune Developers, BPTP, Raheja Universal and Lavasa Corporation. The list of power companies that called off IPOs include Sterlite Energy, Jindal Power, Avantha Power and IND Bharat Power Infra. Other major companies include Reliance Infratel, Glenmark Generics, Gujarat State Petro Corp, One97 Communications. 4. Besides these companies, few companies have already announced IPO deferrals even though approval for SEBI validity for their IPOs still remain. For instance, Micromax has already annoucned IPO deferral, owing to the market conditions.
5. Further, there are atleast 10 other companies who have valid SEBI approval in hand and are left with just 2 months in their validity period of one year from the date of SEBI approval. Such companies include Pride Hotels, Tara Jewels, etc. 6. This surely will impact the Indian corporate's ability in fund raising to finance their expansion projects resulting in slow down in capacity building and job creation. 7. Further, this trend in IPO market will surely set panic in the minds of the Private Equity (PE) funds, as they will be unable to exit from their investments as they generally invest in unlisted companies in the hope of exiting through IPOs. Some such companies are Lavasa Corporation (the investors were Axis Bank, ICICI Bank), BPTP Limited ( the investor was JP Morgan ( through Harbour Victoria Investment), One97 communications (the investors were SAIF Partners, Intel Capita, Silicon Valley Bank, SAP Ventures), Micromax (the investors were TA Associates, Sequoia Capital India, Sandstone Capital, Madison India Capital), You Broadband (the investors was CVC), Avantha Power (the investor was KKR), IND Barath Power (the investors were CVC, Sequoia Capital, Bessemer Venture Partners, UTI Ventures) etc.
8. Further, the government's disinvestment program which was supposed to bring public issues of several blue-chip PSUs couldn’t take off. If the government is not getting enough confidence to bring FPO for ONGC, how will the promoters of any smaller companies stick their necks out? This is surely impacting the confidence of the promoters of the smaller companies. 9. From the retail investors point of view, the long-awaited money-making IPO dream is remaining to be just a dream. Jagannadham Thunuguntla Strategist & Head of Research, SMC Global Securities Limited Contact Number: +91 9711424809
Prospectuses for which SEBI Clearance Received Indicative IPO size Valid Till (Rs. Crores)
Sr. No. 1 2 3 4 5 6 7 8 9 10
Company
Approval Date
Status
Reliance Infra Tel Limited Lodha Developers Limited AMR Constructions Limited PNC Infratech Limited Ambiance Limited PCI Limited Ankita Knitwear Limited Glenmark Generics Limited Kabirdass Motor Company Limited Kumar Urban Development Limited
11-Jan-10 21-Jan-10 29-Jan-10 2-Feb-10 4-Feb-10 19-Feb-10 26-Feb-10 8-Mar-10 9-Mar-10 22-Mar-10
11-Jan-11 20-Jan-11 28-Jan-11 1-Feb-11 3-Feb-11 18-Feb-11 25-Feb-11 7-Mar-11 8-Mar-11 21-Mar-11
5000.00 2500.00 145.28 175.00 1293.00 48.46 25.00 570.00 60.00 320.00
Expired Expired Expired Expired Expired Expired Expired Expired Expired Expired
11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36
Sterlite Energy Ltd Neptune Developers Limited BPTP Limited Gujarat State Petroleum Corporation Limited. Asian Business Exhibition & Conferences Ltd Jindal Power Limited Avantha Power & Infrastructure Limited ICOMM Tele Ltd Virgo Engineers Limited Raheja Universal Ltd. Sel Textile Limited Greatship (India) Limited IND-Barath Power Infra Limited One 97 Communications Limited Lavasa Corporation Limited Sumatex Limited You Broadband & Cable India Ltd Endurance Technologies Limited AGS Transact Technologies Limited Tara Jewels Limited Pride Hotels Limited Micromax Informatics Limited Betul Oil Limited Marck Biosciences Limited Tijaria Polypipes Limited Tara Health Foods Limited Total probable fund raising through IPO
5-Apr-10 29-Apr-10 3-May-10 10-May-10 14-May-10 28-May-10 6-Aug-10 13-Aug-10 1-Sep-10 3-Sep-10 9-Sep-10 6-Oct-10 11-Oct-10 25-Oct-10 11-Nov-10 1-Dec-10 13-Dec-10 14-Dec-10 31-Dec-10 4-Jan-11 13-Jan-11 14-Jan-11 19-Jan-11 2-Feb-11 8-Feb-11 9-Feb-11
4-Apr-11 28-Apr-11 2-May-11 9-May-11 13-May-11 27-May-11 5-Aug-11 12-Aug-11 31-Aug-11 2-Sep-11 8-Sep-11 5-Oct-11 10-Oct-11 24-Oct-11 10-Nov-11 30-Nov-11 12-Dec-11 13-Dec-11 30-Dec-11 3-Jan-12 12-Jan-12 13-Jan-12 18-Jan-12 1-Feb-12 7-Feb-12 8-Feb-12
3000.00 Expired 378.16 Expired 1500.00 Expired 3067.16 Expired 79.41 Expired 7200.00 Expired 1250.00 Expired 200.00 Expired 340.50 Expired 864.00 Expired 102.16 Expired 328.35 Expired 1140.00 Expired 120.00 Expired 1663.31 Expired 38.24 360.00 460.00 170.00 50.00 125.00 426.04 IPO Deferred 100.00 55.34 110.00 160.00 33,424.41
Thank You
SMC Global Securities Limited Corporate Office 11 / 6 B, Ground floor, Shanti Chambers, Pusa Road New Delhi - 110005 INDIA Tel: +91 011 2582 6706/ 2586 3648 Fax: +91 11 2586 3606 www.smcindiaonline.com Contact: Jagannadham Thunuguntla, Strategist & Head of Research Mobile: +91 97114 24809, +91 96509 88002, +91 93120 63677 E-mail: [email protected] Disclaimer : This report is for information purposes only. Due care has been taken in compilation of the report to ensure that the information is accurate to the best of our knowledge and belief. The information contained in the report has been obtained from reliable and publicly available sources. SMC Global Securities Ltd, makes no representations or warranties regarding the accuracy or completeness of such information and expressly disclaims any and all liabilities based on such information or on omissions there from.
