Indian Share Market

Yesterday BSE Sensex was down by 833 points closed at 16630 one another biggest fall in history of market. The much awaited Reliance Power IPO listed in NSE at a price of Rs. 530/- touched high of Rs. 590/- and rolled down in minutes and closed at Rs.373/-. The predicted price range for this share was Rs.600-900 but the listing price of Rs.530 sent a negative shock wave in investors. The whole market was down due to Global cues. Investment Experts suggest that investor should not book the looses and wait for the stability. It is expected that market will further move down between 14500 - 15300. In last week Real Estate firm Emaar MGF & Wockhardt Hospitals pulled back their IPO offering from the market due to poor response. Here i would like to mention that since the time Reliance Power IPO came into market all the major/reputed shares like ONGC, SBI, NTPC, RPL, RCom etc. are down due to slow down in USA economy (the biggest economy in the world) and other global cues. In next 3-4 month market will recover and so the Reliance Power will also recover.

Government will definitely complete its duties in the budget and look out that investors interested is protected.

Today I think market will open at move upward in starting sessions.

Lets Wait and Watch.

Reliance Power IPO

On January 15 the public issue of Reliance Power (Anil Dhirubhai Ambani Group) opened and oversubscribed 10.2 times on same day which is a historic in Indian share market history. I hope that it will be oversubscribed 50 times by its last date i.e. 18^th January 2008 because peoples are selling their existing holding in big quantities to invest money in this IPO and the BSE sensex and Nifty sensex is going down continuously.

All over the country peoples are opening demat account in large number as it is necessary to have a De-Mat account for bidding in IPO. Reliance is issuing 26 crores shares in this price bank of Rs.405-Rs.450 with a discount of Rs.20/- per share. Company has spent a lot of money and using various methods for advertisement of this IPO. From Mumbai dabbawalas (Sex Sigma rated) to TV channels everywhere company is giving ads.

The grey market sources said that the price of share after listing will be approx. Rs.900 although it is not a reliable information but looking at the history of reliance group one can definitely rely on the goodwill of company. Company has around 13-14 power projects based on coal, gas and hydroelectric.

If we look at the power sector, it has great potential and all the shares of power sector companies like NTPC, Power Grid etc. are performing well.

Even many mutual fund companies are planning to launch their new offering immediately after the Reliance Power IPO in a hope that the refund sent to bidders may be attracted for their funds.

Please provide me your views for this IPO.