Post - IPO Performance Drivers
Dalal Street Investment Journal|July 1, 2024
Are you regretting your decision to exit on an IPO's listing day with only small profits while it went on to perform exceptionally well? This is a common dilemma for many investors, stemming from uncertainty about whether to hold on to their IPO shares or rake in early gains. Mandar Wagh discusses the fundamental factors crucial for an IPO's long-term success that investors should consider to achieve better profits
Post - IPO Performance Drivers

We have all been part of conversations about securing IPO allotments, and most of the time the answer is a disheartening 'no. The unfortunate reality is that only a few lucky investors manage to get IPO shares as the demand often far exceeds the number of shares available.

The BSE IPO index has significantly outperformed the Indian benchmarks over various time periods, highlighting the resilience of newly listed companies and robust investor sentiment.

The BSE IPO index is one created by the Bombay Stock Exchange to track the performance of companies that have recently gone public through an Initial Public Offering (IPO). It includes companies listed on the BSE for up to two years post-IPO, calculated based on their free-float market capitalisation. This index serves as a benchmark for investors to gauge the market's response to new IPOs, offering insights into the performance trends of newly listed companies.

A more challenging situation than securing an IPO allotment is deciding what to do next once you have obtained one. Should you hold on to the shares for potential long-term benefits, or should you sell them immediately to capitalise on listing gains? Often, investors eagerly book profits on the IPO listing day, securing considerable gains but potentially missing out on stellar long-term returns if the IPO is truly promising. Here are a few examples of 2024 IPOs wherein exiting on the listing day may have resulted in forfeiting significant future gains by not remaining invested.

While most brokerage houses and analysts provide recommendations before an IPO launches, very few offer guidance on post-IPO performance and the subsequent steps investors should take after a certain period. Let's understand the fundamental factors crucial for an IPO's long-term success and identify what you should continuously monitor to make informed decisions about your investments.

Bu hikaye Dalal Street Investment Journal dergisinin July 1, 2024 sayısından alınmıştır.

Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.

Bu hikaye Dalal Street Investment Journal dergisinin July 1, 2024 sayısından alınmıştır.

Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.

DALAL STREET INVESTMENT JOURNAL DERGISINDEN DAHA FAZLA HIKAYETümünü görüntüle
How To Invest In An Ageing Bull Market
Dalal Street Investment Journal

How To Invest In An Ageing Bull Market

Bull rallies (periods when stock prices rise) and bear declines (periods when stock prices fall) are natural parts of stock market cycles, but they don't follow a fixed timeline.

time-read
5 dak  |
July 29, 2024
Should You Entrust All Your Money To A Single AMC?
Dalal Street Investment Journal

Should You Entrust All Your Money To A Single AMC?

If you are a market participant, you have probably heard the quote 'don't put all your eggs in one basket', which suggests diversification. Investors often focus on diversifying across categories like large-cap, mid-cap and small-cap, but they may unintentionally overlook diversification across different AMCs. The question arises: is AMC-wise diversification really necessary? Rakesh Deshmukh takes a closer look at this scenario

time-read
7 dak  |
July 29, 2024
Wild Swings Engulf Global Equities
Dalal Street Investment Journal

Wild Swings Engulf Global Equities

U.S. stock markets experienced significant volatility. An early-week rally pushed the markets to new highs, but this momentum faded, primarily due to weaknesses in the tech sector. The major indices had a mixed finish with, S&P 500 and Nasdaq closed lower, while the Dow recorded a notable gain.

time-read
2 dak  |
July 29, 2024
U.S. Elections and China's Economy Hamper Commodities
Dalal Street Investment Journal

U.S. Elections and China's Economy Hamper Commodities

Commodity markets experienced selling pressure in the last fortnight, driven by uncertainties surrounding the upcoming U.S. presidential elections, concerns about the Chinese economy, and increased agricultural production in Brazil.

time-read
2 dak  |
July 29, 2024
Wealth Building For Retirement Through Mutual Funds
Dalal Street Investment Journal

Wealth Building For Retirement Through Mutual Funds

Retirement is one of the most crucial and lifechanging phases. It marks a period where maintaining your lifestyle becomes paramount even though your regular income stops.

time-read
3 dak  |
July 29, 2024
Mastering Investment with Information Ratio
Dalal Street Investment Journal

Mastering Investment with Information Ratio

Information Ratio helps in navigating the complexities of the investment landscape by assessing an active fund manager's performance. And though it has its limitations, it remains an essential part of the finance industry. The article explains what Information Ratio is and how investors can use it as another tool

time-read
6 dak  |
July 29, 2024
Plan To Be Financially Independent
Dalal Street Investment Journal

Plan To Be Financially Independent

Each of us aspires to be financially independent as it ensures having enough resources to be self-sufficient and control our finances.

time-read
2 dak  |
July 29, 2024
❝Technology is the new game-changer"
Dalal Street Investment Journal

❝Technology is the new game-changer"

With a new breed of young investors entering the financial markets, it is the use of technology that is increasingly playing a major role in how investments are done and tracked. Anand Radhakrishnan, Managing Director, Sundaram Mutual Fund, shares his opinion about how this factor is turning into a significant tool and how it will shape the strategies of his company

time-read
5 dak  |
July 29, 2024
What If Donald Trumps?
Dalal Street Investment Journal

What If Donald Trumps?

The potential election of Donald Trump as president in the U.S. carries significant implications for the Indian equity market. It could lead to changes in the global trade dynamics, in particular affecting the Indian IT sector while also raising inflation levels and leading to yet another revision in the visa programme for Indians who want to work in the US. The article takes a closer look at what may lie in store

time-read
6 dak  |
July 29, 2024
Sectoral Gains Make A Mark
Dalal Street Investment Journal

Sectoral Gains Make A Mark

Benchmark indices continued their uptrend, reaching new record highs, although the pace has slowed as the broader markets faced selling pressures

time-read
2 dak  |
July 29, 2024