DLF IPO Brings Surprise for Retail Investors

June 13, 2007	(Be the first to rate this story!)  Loading ...
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DLF Limited, a prominent name in Indian real estate has been making the headlines because of its mega initial public offer (IPO), which got fully subscribed on second day of its issue. However, small retail investors will also have nice prospects to dig.

Believed to be the country’s largest public issue, DLF’s Rs 9625 crore IPO closes on June 14. The retail part of the issue is still to be subscribed fully. Bringing a time to rejoice for small investors, the IPO has reserved over 30 per cent of the shares for retail investors.

These investors are just required to pay a part of the money for the shares i.e. Rs 150 per share and make the remaining payment after allotment. However, they will neither be able to cash out a premium on the day of allotment nor exit the scrip, as they are not paying in full.

The retail investor will have to pay the entire amount upfront and invest in stock to take the exit route, explains Ganesh Shanbhag, CEO of SMS Financial Services Ltd. This clearly underlines the risk factor associated with the property prices. Also, many feel that the issue has been overpriced.

Since the retail investors have not shown large interest in DLF’s IPO in the first two days, the merchant bankers expect the small investors to apply on the last day. The company is confident about getting a substantial allotment considering the size of the issue.

News Published Under:   Retail Market in India |

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