Reliance Power - Whose failure

It was never thought that a big IPO like Reliance Power will fail in a bullish market like India. But nature and markets are very clever and unbeatable. To some extent markets always master humans. Yes, everything came to light after 3rd week of January. Even Anil Ambani would not have thought that Reliance Power IPO will be a big failure in markets.

Reliance Power came for subscription when Indian markets are at their peak. Every normal Indian who do not venture into stocks was thinking of that they didnt utilise the opportunities of Indian stock market boom. Then came the Reliance Power, the mother of all Indian IPOs so far. The strange thing was that every analyst is bullish of this IPO, though the company did not have any revenue so far. Even the pessimisic analysts were saying that one can invest even though fundamentals are weak.

The greed to gain money in a short span of time makes the retail investors to subscribe for Reliance Power IPO. It was heard that some 2 lakh DeMat applications were pending with NSDL in those 2 weeks. Many HNIs were hedging their money for the IPO.

But came the crash which mada almost everyone poorer than ever. Suddenly all the IPOs seems to be bad. Even 3 IPOs were withdrawn last week. Reliance ower made its debut with a huge loss to all types of investos... Retail, QIBs and HNIs. Retail investors are a bit ok because only 17 (max) were allotted to them. The utmost lesson from this... Think twice before making an investment even in an IPO. Go for companies with a good revenue book, not a company only with good speculation of revenue.