Coal India IPO price band fixed between Rs.225 and Rs.245

by Manshu on October 12, 2010


The Coal India IPO price band has finally been fixed at Rs. 225 – 245, and there is going to be a customary 5% discount to retail investors.

So looks like the gray market was quite close because they had earlier talked about a range of Rs. 225 – Rs. 270. The EPS in 2010 was Rs. 15.56 so the P/E multiple at the higher and lower end of the price band is 14.46 and 17.3, so looks like the ministry decided to leave something on the table for investors. I think you are going to see huge over-subscription numbers on this Coal India IPO.

You can read my earlier review of Coal India IPO here.

{ 4 comments… read them below or add one }

kapil dev October 21, 2010 at 10:11 am

can u plz tell me how the price band is fixed and by whom these are fixed?


Manshu October 21, 2010 at 11:10 am

The price band is decided by the promoters of the company based on many qualitative and quantitative factor, but the bottom line is whether they’d be able to find takers for their stock in the price band.

So you see that the Coal India IPO has received enough bids at Rs. 245 for them to issue the stock at the higher end. Had they fixed the price at say 1,245, the response won’t have been that high, and they wouldn’t have been able to sell their IPO.


mohan December 6, 2010 at 8:28 am

Was coalindiaIPO was taxfree ? if yes which other IPO is taxfree


Manshu December 6, 2010 at 9:48 am

Hmmm, no, there is no such thing as a tax free IPO. Can you please elaborate a little more on what you are referring to because I think you might be mixed up in two things, but am not able to point to what it is.


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