Moneycontrol News
The year is coming to an end and its time for investors to look back and assess their investments. The year 2018 saw a lot of action in the primary market, or initial public offerings (IPOs).
Of all the IPOs listed this year, five IPOs that performed the worst were — Apollo Micro Systems, ICICI Securities, Indostar Capital Finance, Hindustan Aeronautics, and Bharat Dynamics. They gave a negative return in the range of 33 to 54 percent.
While most of these stocks were undersubscribed, Apollo Micro Systems was subscribed 248 times and Indostar Capital Finance was subscribed 6 times.
Moneycontrol analysts suggest that most of these stocks had lofty valuations as they were listed at a time when the companies' performances were at a peak. The IPOs, however, could not give good returns in the short term because their valuations were placed based on speculations of the company's performance in a long term.
"Unfortunately, these is called 'bull market tragedy' because they get priced by investment bankers at a very high premium and leave very little on the table for investors who invest in the IPO," Sanjiv Bhasin, Executive Vice President, Markets & Corporate Affairs at IIFL told Moneycontrol.
Considering that the market is seeing a lot of rotation, Bhasin said,
Hindustan Aeronautics and Bharat Dynamics will be under pressure. However, with a change of guard at ICICI, ICICI Securities may give a better performance in 2019.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
