Are IPO Gradings Misleading in the Initial Public Offers (IPOs) ? ~ Yes !

Just Uploaded a few days ago a Report on IPO Gradings on www.jsalphaa.com

Are IPO Gradings Misleading in the Initial Public Offers (IPOs) ? ~ Yes !

Of all the 129 Graded IPOs from 2009 to 2012,81  are currently quoted below IPO Offer Price

Top View of Graded 129 IPOs

Grade ↓

Grade Wise

No of Companies whose Share Price is Up from Offer Price

No of Companies whose Share Price is Down from Offer Price

TOTAL  Graded IPOs

1

4

8

12

2

9

35

44

3

17

24

41

4

15

13

28

5

3

1

4

TOTAL

48

81

129

 

Year ↓

Year Wise

No of Companies whose Share Price is Up from Offer Price

No of Companies whose Share Price is Down from Offer Price

TOTAL  Graded IPOs

2012

8

1

9

2011

15

23

38

2010

17

46

63

2009

8

11

19

TOTAL

48

81

129

 

Two Startling Evidence revealed themselves when we observed all the 129 IPOs that were Graded by SEBI Registered Entities to do so ~CRISIL,CARE,ICRA,FITCH or BRICK

Observation 1

IPOs that were graded lowest 1/5  that have become WEALTH CREATORS

4 of the 12 IPOs graded poorly at just 1/5 by one of the SEBI accredited rating agency are actually huge Wealth Creators

Just Look at the Uptrend ! ~Were the Grading Agencies wrong in giving the lowest grading or is there Share Price Manipulation ? ~ if one suspects the Latter how is it that such Manipulation has been sustained for long !

IPOs that were graded lowest 1/5  that have become WEALTH CREATORS

Listed Company

Issue Closing Date

Graded a Poor 1 by

No. Of times Oversubscribed

Offer Price

Rs

CMP

Rs

Up Trend

%

Onelife Capital Advisors Ltd

04-10-2011

CARE

1.51

110

721

555

VKS Projects Ltd

04-07-2012

CRISIL

1.02

55

218

296

Sudar Industries Ltd

24-02-2011

CRISIL

1.30

77

168

118

Olympic Cards Ltd

13-03-2012

CRISIL

0.99

30

59

97

 


  1. Observation 2

 

  1. IPOs that were graded highest at 4/5 or 5/5 have become WEALTH DESTROYERS


14 of the 32 IPOs graded high at 4 or 5 between 2009 to 2012 have been Wealth Destroyers !

IPOs that were graded highest at 4 or 5/5 that have become WEALTH DESTROYERS

Listed Company

Issue Closing Date

Graded by

No. Of times Oversubscribed

Offer Price

Rs

CMP

Rs

Down Trend

%

A2Z Maintenance & Engineering Services Ltd

10-12-10

CARE

0.92

400

40.35

-89.91

SKS Microfinance Ltd

2-8-10

CARE

11.44

985

155.45

-84.22

Orient Green Power Company Ltd

24-9-10

CRISIL

1.06

47

11.48

-75.57

Tecpro Systems Ltd

28-9-10

CRISIL

20.26

355

146.9

-58.62

PTC India Financial Services Ltd

18-3-11

CARE & ICRA

1.51

28

15.9

-43.21

Punjab & Sind Bank

16-12-10

CARE

50.37

120

72.05

-39.96

Ashoka Buildcon Ltd

28-9-10

CRISIL

14.65

324

200

-38.27

MOIL Ltd

1-12-10

CARE

56.16

375

251.9

-32.83

JSW Energy Ltd

9-12-09

CARE

1.56

100

71.25

-28.75

IL&FS Transportation Networks Ltd

15-3-10

CARE & FITCH

35.62

258

197.8

-23.33

Cox & Kings Ltd

20-11-09

CARE

5.64

165

136.4

-17.33

SJVN Ltd

3-5-10

CARE

6.51

26

22.55

-13.27

Hindustan Media Ventures Ltd

7-7-10

CRISIL

4.89

166

148

-10.84

Gujarat Pipavav Port Ltd

26-8-10

CRISIL

18.51

46

43.7

-5.00

A2Z was supported in the Primary and Secondary Markets by the well known Investor Rakesh Jhunjhunwala ~ your IPO Investment has eroded 90% in it !

For more details you can access the Free Module SCRIP STANDPOINT on www.jsalphaa.com where this and several other Interesting Reports & Views have been uploaded