New Delhi, June 26:
NHPC launched its initial public offer (IPO) in August 2009 and mopped up around Rs 6,000 crore. The IPO was over-subscribed 24 times. The company had released 167.73 crore shares in the primary market with a price band of Rs 30-36. Government currently holds 86.36 per cent stake in the company after divesting five per cent in 2009. The company issued fresh equity for remaining stake. So far, NHPC has issued dividend twice, Rs 0.60 on September 6, 2011, and Rs 0.55 on September 9, 2010, according to information on the BSE. In 2011-12, NHPC reported an EPS of Rs 2.25.
Keywords: initial public offer, IPO,
Comments:
The GOvt and the Company's Management have taken the investors for a ride. The banks are paying savings bank interest of 4 % and above and the company has not adequately compensated the shareholders.SEBI also does not care to ensure that the pricing of IPOs and the compensation paid to shareholders are reasonable and the management maintains a healthy trend to make shareholders happy. Most of the IPO issues by the Govt are like this and the shareholders have lost their money and confidence in the market.SEBI should make a study and come out on what basis IPO issues are priced, to what extent shareholders are compensated,the volatility in the shares, the number and percentage of retail shareholders, how the management is performing in terms of Corporate Governance etc. The capital market in India is very volatile as the percentage of retail shareholders are comparatively low and they have not been adequately compensated by the companies.NHPCis a solid example.Will SEBI care to look into?
NHPC is not doing well. I have lost lot of money.
The attitude of the Government seems to be just to collect the money through IPO or FPO and then forget about the prospects of the organisation (leave aside the investors). Criminal neglect as an owner and scant regard to its moral duty to protect the interest of the shareholders indeed. Was it any surprise that there were no takers for recent divestments in PSUs? Almost all past PSU public or follow on issues are currently quoting at deep discounts to the issue price.Government has acted as a wealth destroyer.
IPO's are not for long term investors. Most of the people who apply for IPO's are doing it only for listing gains. Problem is not IPO, it is the performance of the companies. If NHPC execute all the projects, it would quote much higher than the IPO prcie.
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