Business Daily from THE HINDU group of publications
Monday, Sep 08, 2008
ePaper | Mobile/PDA Version | Audio
Business Daily from THE HINDU group of publications Monday, Sep 08, 2008 ePaper | Mobile/PDA Version | Audio |
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Mentor
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Private Placement Markets - Stocks Columns - For the Asking The Securities and Exchange Board of India (SEBI) is all set to discard the average of last 26 weeks’ quotation norm. What is your take on it? KSNR Srinivasalu, Secunderabad
The norm for making private placement, or for that mater any allotment that seeks to bypass the rights’ norm, has all these years been at a price that is the higher of the average of highs and lows of the last 26 weeks or the similar average of last fortnight preceding the relevant date. If anything, it was good because six months are long enough to iron out volatilities and other aberrations in the stock market. Jettisoning it in favour of fortnight’s average in my view is retrograde. The SEBI Chairman has gone on record implicitly approving of the practice followed in advanced countries of basing the allotment on the basis of last quotation. Well, it is difficult to share his enthusiasm given the mischief potential inherent in any short-term mechanisms. S. MURLIDHARAN More Stories on : Private Placement | Stocks | For the Asking
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