Public issues are gaining great response | Punjab National Bank and Allahabad bank are in losses in public issues
There is great response to the public issues of the government companies. The history from 2003 is recorded and this supports the fact that there is great response. In the list on the first day, 94% companies are there with 10% premium. In the research done by Inam Securities, all the investors are attracted by 63% offers in the PSU issues. The banks from UCO bank in 2003 to the Engineers India Bank in 2009 have been listed on the first day. One of the attractive features is that they provide 5% deduction in the price of the issue to the government or retail investors. PSU issues are giving some concession to the small investors up to some extent. NHPC, NMDC and SJVN which are released in to the market in the last 13 months are being traded for low rates than the issue rate.
There are good results in the long term with the remaining public issues in the government related companies. The Punjab National Bank and Allahabad bank are in losses in the listed 28 companies but the shares of these two banks had increased by 175% from that time to today. The government is giving the share to other companies like Coal India etc and it had taken back the 5% share from the Oil & Natural Gas Corporation and 10% share from Indian Oil Corporation. There is a chance for SAIL and Power Grid Corporation to enter the market with Follow-on-issues.