![]() ![]() So for an Indian investor, this is a great opportunity to buy into good paper and sit on it subject to the price correctly. So it is Indian money which gets parked more into those IPOs than foreign money and it is foreign money which buys on the listing day. You should always remember, any IPO coming in in India, the majority of the investors are domestic investors because almost 60-70 percent of the IPO is allotted to domestic investors and mutual funds. So retail investors can participate more. And people need this kind of paper to come in. Majority of the IPOs have done well so far.Īnuj: So, in that context, your view on the government paper?Ī: That you have seen with Cochin Shipyard IPO which got a great success and you have seen many more companies like GIC is coming in, the New India Assurance (NIA) is coming in, so you are going to see a lot of those kind of quality paper also coming in and if they are priced rightly, as they did in the Cochin Shipyard, I think they will also be lapped up very immediately. Yes, post listing sometimes, few stocks go up, but that is not the benchmark. So I do not believe there is any froth outside in the IPO scheme. So if that paper is priced correctly, it will be lapped up in a very big way. So the host of insurance companies are going to get listed, there are large corporate groups like Mahindra, Godrej coming in, means this is the kind of paper which everybody is waiting for it to come. So if that is maintained, which I believe it should be, the quality of paper which is going to come in the next 3-5 months is top quality and people actually want newer companies to list so they can invest more money instead of the same old companies which are now very richly valued. You have seen euphoria post listing where people are buying 50 percent higher or 100 percent higher, but the IPO valuations have been attractive so far. Is there at all, any sign of euphoria you think, in the primary market?Ī: I do not see that great kind of euphoria. Surabhi: You spoke about a strong pipeline of initial public offers (IPO) and lots of fund raising that we have seen on the street despite the concerns that we have discussed. So any large correction or decent correction, people may look at it as an opportunity to buy rather than sell into. So equities is, right now, the most favourite spot to be in. But also, do not forget, you do not have any other investment option today in the country because real estate, gold, all of them do not look like great options. ![]() So there is some kind of a safety in India in that sense. So when the fall comes, I am sure, people will be looking at an SIP and start investing much more when the market corrects. And smartly enough, that SIP flow also is reducing as the market is going higher. That is exactly what happened during the demonetisation time that the SIPs saved the market. That is a large portion which now comes into every domestic mutual fund which is that way good for the country because when the markets fall, that kind of money starts pumping into the markets which actually stabilises it. From a domestic point of view, do you think this kind of trend will continue and will support the market on the downside?Ī: Yes, because if you see in the domestic mutual funds, the inflow which they are getting, they are more in the form of systematic investment plans (SIP). Obviously the geopolitical risks are also playing on everybody's mind and people are just trying to sense what can go wrong globally which can impact the country and which can also impact India in that sense.Īnuj: The global worries are taken on board but Indian market seems to be outperforming a bit also because of the domestic liquidity. So we are in almost a global consensus view saying that get out of equities and that is what is scaring people. A: Globally, people are definitely concerned on the valuations and if you look at any single article, globally if you pick up a newspaper, I have not seen a more consensus view which is so negative globally and people have been virtually telling people to get out of equities. ![]()
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