Coal India IPO finds no takers

by Manshu on October 18, 2010

in IPO/NFO

for the employee reservation part of its offer.

Forgive the mis-leading headline but the Coal India IPO opened today, and as expected, there was a lot of excitement in the media about its subscription numbers.

Reading through the headlines I felt the IPO must have done quite well on the first day itself, but on closer look, I found nothing  spectacular about these subscription numbers.

So, I thought I’d go the other extreme and with a little use of selective statistics create a headline which is eye catching, true to an extent but not really reflective of the underlying reality.

It’s true that most retail investors participate on the last day, and that as the momentum builds this issue may be over-subscribed by up to 10 times, but that hasn’t happened yet, so instead of speculating on what could happen, I thought I’d take a look at the current subscription numbers, and show you how they are mostly dull.

As long time readers know, a certain percentage of stock is reserved for different categories of investors, so I will show you the Coal India IPO subscription numbers as they stand at the end of day 1 broken out into the different categories.

Coal India IPO Subscription Numbers Day 1

Coal India IPO Subscription Numbers Day 1

All data from NSE.

As you can see the QIBs are the ones that have taken a good position on day 1, but the responses from other categories is just about what any other IPO would expect, so really there’s nothing much to see here.

If you are not familiar with the categories, and how the headline over-subscription number most often reported is the sum of all categories, and is not entirely relevant for retail investors read my earlier post on over-subscription numbers that I did during the NHPC IPO.

Oh, and I almost forgot, here is how the shares are reserved among different categories.

Coal India IPO Subscription Breakup

Coal India IPO Subscription Breakup

{ 5 comments… read them below or add one }

Aakaash Desai October 20, 2010 at 6:39 am

Stupid headline. Don’t err purposely to increase page visit.

Reply

Manshu October 20, 2010 at 1:01 pm

The stupid headline was the whole point of the post.

Reply

Someone from the industry October 21, 2010 at 1:54 am

Ok dude,

Such useless statistics. Do you understand the magnitude of this issue? 15k crore.
The problem of using scale statistics (i.e 1.5x times, 4 times, n times) is that it ignores the magnitude.

So even if it is subscribed by 2 times (which it has – 21 Oct – 2.30 PM), that means retail folks have pumped in 30k crore. Do you know how many zeroes that figure has?
Go figure.

Reply

Sachin October 21, 2010 at 3:13 am

Very Stupid info…

The IPO is indeed “THE BIG ONE”

Reply

sambasivarao vemulapalli October 21, 2010 at 9:50 am

Every thing is went on as i thought,well COAL INDIA IPO stood with a diamond crown in PSU industries.no one can destroy its image…it is the back bone of our econamy…All investors will get good future with this issue….

Reply

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