01 May 07 IPO Grading Mandatory from Today, May 1 2007 as SEBI gets tough
The Indian capital markets regulator, SEBI has made IPO Grading Mandatory from Today, May 1 2007. The IPO grade assigned to an IPO issue represents a relative assessment of the fundamentals of that IPO issue in relation to the other listed securities in India. SEBI feels that IPO grading can be used by the investor, especially small investor, as a tool to make investment decisions. However, how successful IPO grading would be, is debatable. In the past we have seen that issues which got a grade of 1, which is the lowest, have fared better in terms of oversubscription and listing gains, when compared to IPO issues which where given a grade of 3. It appears that one cannot blindly invest in an IPO, by just looking at its grade. IPO grading is a big boost to credit rating companies like CRISIL, ICRA, CARE and Fitch who already have bulging order books for grading IPO’s.
For instructions on how to make money from IPO’s with minimum risk, I suggest you read the following article
http://www.bullishindian.com/eight-tips-for-retail-investors-for-applying-in-ipo-for-listing-gains/162/
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