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Stocks

Reliance Power In The Doldrums

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The Reliance Power stock has had a shocking listing (excuse the pun). With an issue price of Rs. 450, the stock started off at Rs. 530 and then went into a steep fall. As I write, it’s standing at Rs. 420, and it had briefly gone below the 400 levels too.

Obviously this is doom for the greedy IPO followers, and specially for the loser loan takers. It’s harsh on them that the price is below the offer price, and worse if they have to pay interest on a loan! Plus, it’s likely that they got some obscenely low number of shares. (if you were lucky you would get 17 shares, Rs. 9K worth – for an investment of 1 lakh, the rest of the money being refunded. You still have to pay interest if you borrowed the money, until you get the refund.)

RPower seems to have taken the Nifty with it. At 4900, the Nifty looks like it’s ready for another steep fall. I should get out of whatever little investments I have

Disclosure: Long some stocks and mutual funds. No short positions. (Unfortunately)

  • hari says:

    >HI Deepak,

    RELPOWER has closed at 373.
    I am thinking of buying the stock in future.I am baffled at how a reliance listing could go below issue price.
    Would you buy if it falls a lot. I am planning to buy if it falls quite a bit.

    Regards
    hari

  • Anonymous says:

    >This stock will be available for Rs.10 when we have world wide depression. I will save my money for that day.

  • Gunjan says:

    >Reliance Power issue has proven that you cannot hypnotize people just on anything starting with “Reliance”.

    ‘Reliance’ is not always to be relied upon.

    Ultimately its all happened based on what is the ground reality (that, Reliance Power has more on offer document than on plan).

    And when strong substitute power share (NTPC) is already available with the capacity that Reliance is planning after years; where the value is is obviously visible

    And about the comment on depression: I some how do not agree that there would be any “world wide” depression. There are lot of takers still in world who are waiting to get into Indian market and there by participate in India Story. So even if dollar is pulled off, YEN would come or some other currency would come in.

  • Stock Marketed says:

    >I think Gunjan is totally uninformed which is very much like me, a small investor who lost money and all this just because some vested selfish interests of big entities (mostly Mukesh Ambani) who wanted this IPO and listing to be a failure.
    Even SEBI is sitting with closed eyes on such things. I am glad to read the article on ET which drills deeper into the speculation which has gripped all smart investors. Someone has also openly written in their blog with a lot of details of people involved in this http://rilfraud.blogspot.com/ . It also has a lot of fraud cases of Reliance Petroleum

  • Anonymous says:

    >I think this happened b’cos of 3 reasons –

    1. FIIs pulling out all the money they invested in past 6 monnths.This affected every one bharti, tata,ongc, reality etc.

    2. Most IMP is that some group of ppl who did not want ADAG to become richest with this IPO which is a record/ landmark IPO but these group of ppl applied only to sell at loss on listing.

    Its obivious who is behind all this, but i believe ADAG will follow dhirubhai’s footsteps and not let the retail investor suffer- wait for the the bonus round and markets to pick up then see how this scrip picks up.