IPO's to watch out for 6.1.11

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Hind Copper FPO may be priced at Rs 120-140/share

State-owned Hindustan Copper will be launching its follow-on public offer (FPO) soon, which may be priced at Rs 120-140 a share.  The FPO could be out by March 2011. The company is planning to raise over Rs 2,000 crore via the issue.  Hindustan Copper is eyeing mines in African Nations and Chile. It will invest Rs 4,000 crore on expansion in 5 years.

FPO likely by 2nd week of Feb: SAIL

India's second largest steel company Steel Authority of India (SAIL) may come out with its follow-on public offer (FPO) by the second week of February.  The company may file initial share prospectus on January 20.

Trim Plastics files IPO papers with SEBI

Toothbrush manufacturer Trim Plastics proposes to enter capital market with an initial public offering of 59.3 lakh equity shares, which shall constitute 56% of the fully diluted post issue paid up capital of company. The company has filed draft red herring prospectus (DRHP) with the market regulator SEBI. Trim is engaged in manufacturing toothbrushes. Current installed capacity is 42 lakh pieces per month. Company currently produces toothbrushes for a multi-national corporation on a contract manufacturing basis.  Issue proceeds will be used for backward integration cum expansion plan for existing manufacturing unit at Gujarat; brand building activities of ‘Dent-O-Fresh’ brand; and widening retail presence; which require Rs 16.09 crore and these expenses will be funded solely through issue.  Promoters' shareholding will be reduced to 36.21% from 82.30% post issue.

CRISIL assigns grade 3/5 to Endurance Technologies IPO

CRISIL Equities has assigned a grade of 3/5 to the proposed initial public offer (IPO) of Endurance Technologies, which indicates that the fundamentals of the IPO are average relative to other listed equity securities in India.  Endurance is a leading automotive component manufacturing company in India. It manufactures and supplies a diverse range of components for two-wheelers, three-wheelers, passenger vehicles, light commercial vehicles (LCVs) and heavy commercial vehicles (HCVs).  Its products include aluminium die-casting products, suspension products, transmission products and brake products.

C Mahendra Exports IPO fully subscribed

Diamond jewellery player C Mahendra Exports initial public offering (IPO) has been subscribed 1.03 so far.  The issue will close for subscription on January 06.  The issue has received bids for 1.54 crore equity shares as against issue size of 1.5 crore shares. Reserved portion of non-institutional and retail investors was subscribed 1.24 times and 1.47 times, respectively. Qualified institutional investors' portion subscribed 0.65 times.

LinkedIn to go public in 2011

LinkedIn, the social networking web site for professionals, is planning to come out with an initial public offering (IPO) in 2011 and has selected its financial advisors. Morgan Stanley, Bank of America and JPMorgan have reportedly been selected among the book running lead managers.  LinkedIn claims more than 85 million members.  LinkedIn's investors include Sequoia Capital, Greylock Partners, Bessemer Venture Partners and Goldman Sachs.

Modern Tube Industries files DRHP for Initial Public Offer

Modern Tube Industries is planning to enter the capital markets with an initial public offering (IPO) of Rs 65 crore. The company has filed a Draft Red Herring Prospectus with market regulator, SEBI. The equity shares are proposed to be listed on the BSE.  Aryaman Financial Services and Link Intime (India) are helping the company in the process of raising funds from the market.  Modern Tube Industries is a Gujarat based company and was incorporated on July 2006. The company is engaged in the manufacturing of high quality stainless steel seamless and welded tubes, u-tubes and pipes as well as the export-import of sheets, coils, seamless tubes in all AISI and ASTM standard and grades on made to order basis as well as standard stock basis.  Today it has an annual installed capacity of 7200 metric tons per annum. Its products are exported to over 10 countries. 

Pricing key to IPO success for private companies as PSUs also in queue

Private companies, like Jindal Power and Sterlite Energy, planning an initial public offering (IPO) in 2011 may have to lower valuation expectations as investors turn choosy, after profiting from state-owned companies’ issues that were priced attractively.  Investors are choosing companies to bid for in IPOs and are avoiding highly-priced ones. But they are bidding overwhelmingly in attractively-priced issues such as Coal India and MOIL, a manganese ore miner. It has been a practice that government share sales are priced lesser than peers, while that of the private sector are mostly even above peers. This has led to some poor response and losses for investors. 

There are at least 100 public issues in the pipeline, with an indicative size of around Rs 50,000 crore. While 35 prospectuses have already got the Sebi clearance, the remaining 65 are awaiting nod.  The indicative size of these 35 issues is to the tune of about Rs 35,000 crore, while that of 65 issues may be Rs 15,000 crore.  If the government maintains its Rs 40,000-crore target for the next fiscal too, total may be Rs 90,000 crore, up 27% from 2010.  Real estate companies, which are facing discrimination by banks after a few executives were arrested in the bribes-for-loan scandal, will find it more difficult to raise money from public than the rest.  Real estate IPOs have led to investor losses, including the nation’s biggest DLF which is down 45% from the sale price of Rs 525 apiece. Purvankara Projects, which sold shares at Rs 400, has slumped 71%. Kolte Patil is trading 62% lower and DB Realty has lost more than half its value.