Monday, February 26, 2007

Tracking NSE IPOs

The stock market in India is booming like nobody's business and so many companies are looking at going public by offering an initial public offering (IPO). The whole IPO scene has become an easy way to make money. Just subscribe to an IPO offerng during the offer period and then once the stock lists, dump the sucker in the market and make an easy 10-25% returns. The key to success is obviously picking the right IPO. So how do you do that? I use the classic herd behaviour approach to do it since I dont have the time to sit and analyze each company and its fundamental merits. Let me explain in detail...

The NSE website lists all the currently running IPOs and when you click on any one of them it actually gives you near realtime data on how much of subscription that the particular IPO has undergone during the offer period. If I see a large (1000 - 4000%) oversubscription especially in the institutional buyer's market, I figure that the big guys with their advanced research teams have figured out something interesting in this stock so I might as well buy it.

Mind you this works most of the time especially if you are planning to sell short term. There have been spectacular failures in this approach for me in the past but hey - this isnt exactly research you know! I am OK with the results that I have seen so far.

As far as getting an allocation goes, let us not even go there....!!!

I decided to start tracking the current NSE IPOs so I can plan this game better (of course it is a game - a gambling game - don't be dumb and think we have anything that is scientific here!). To make the IPO dates public, I initially added it to Google calendar. I am adding a link to the same on the right. If you use google calendars to track any of your dates, just clicking on the button will add my calendar to your list of available calendars.

4 comments:

Vishal said...

Thank you. I have added the calendar to my google calendars. Let's see how your idea shapes up. Would any changes you make in the nse ipo calendar reflect real time in my google calendar?

Vivek Venugopalan said...

Vishal - the updates would be automatic since Google just merges the two calendars and gives you a single view

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Harshal said...

Hi,
It is really nice one.