study on performance of initial public offer (IPO) in indian capital market

BHAVANS INSTITUTE OF MANAGEMENT

BHAVAN’S INSTITUTE OF MANAGEMENT

“A STUDY ON THE PERFORMANCE OF IPO's

INDIAN CAPITAL MARKET

BIMM ID: PGPMO8 “05”

Submitted in the partial fulfillment of the requirements of the

MBA degree course of BHAVANS INSTITUTE OF MANAGEMENT

PROJECT GUIDES:-

INTERNAL GUIDE � PROF. PRAVEEN BHAGAW

EXTERNAL GUIDE � Mr.

BHAVAN’S INSTITUTE OF MANAGEMENT, MYSORE

BHAVANS INSTITUTE OF MANAGEMENT, MYSORE


MYSORE

ON THE PERFORMANCE OF IPO's

INDIAN CAPITAL MARKET”

- - - AT INDIA INFOLINE

BY

AMITH KUMAR G

BIMM ID: PGPMO8 “05”



-

PROF. PRAVEEN BHAGAWAN

Mr. MANI MARAN


2008-2009


Page | 1


ON THE PERFORMANCE OF IPO's IN THE

AT INDIA INFOLINE





THIS IS TO CERTIFY THAT MR. AMITH KUMAR G HAS PREPARED

INTERNSHIP REPORT TITLED

IPO's IN THE INDIAN CAPITAL MARKET

PROF. PRAVEEN BHAGAWAN.

THE DRAFT HAS BEEN THROUGHLY R

THE RECOMMENDATIONS OF THE PANEL OF EXAMINERS AND THE

REVISION HAS BEEN ACCEPTED BY THE INTERNAL GUIDE. THE

STUDENT CERTIFIES THAT NO PORTION OF THIS REPORT HAS

BEEN PLAGIARIZED OR COPIED OR QUOTED WITHOUT THE

PERMISSION IN ANY FORM. THIS REPORT HAS NOT BEEN

SUBMITTED TO ANY OTHER INSTITUTE / UNIVERSITY FOR ANY

OTHER DIPLOMA / DEGREE.

INTERNAL GUIDE MR.PRAVEEN BHAGAWAN

DATE AUGUST 10,2009

RESIDENT DIRECTOR

DATE


CERFITICATE


INTERNSHIP REPORT TITLED “A STUDY ON THE PERFORMANCE OF

IPO's IN THE INDIAN CAPITAL MARKET” UNDER THE GUDIANCE OF

PROF. PRAVEEN BHAGAWAN.

THE DRAFT HAS BEEN THROUGHLY REVISED ON THE BASIS OF

MENDATIONS OF THE PANEL OF EXAMINERS AND THE





UBMITTED TO ANY OTHER INSTITUTE / UNIVERSITY FOR ANY

OTHER DIPLOMA / DEGREE.

MR.PRAVEEN BHAGAWAN STUDENT

AUGUST 10,2009 DATE

MR. NARSISMURTHY DIRECTOR

DATE


Page | 2


A STUDY ON THE PERFORMANCE OF

UNDER THE GUDIANCE OF

EVISED ON THE BASIS OF

MENDATIONS OF THE PANEL OF EXAMINERS AND THE





UBMITTED TO ANY OTHER INSTITUTE / UNIVERSITY FOR ANY

AMITH KUMAR G

MR.KRISHNAMURTHY


ACKNOWLDGEMENT

IT IS MATTER OF HONOU

THOSE WHO GUIDED ME DIRECTLY OR INDIRECTLY IN C

PROJECT REPORT. I WOULD LIKE TO SPECIALLY THANK,

Mr. M.PRABU, FOR GUI

PROVIDED, THROUGHOUT THIS PROJECT

PROF. PRAVEEN BHAGAWAN

THROUGHOUT THIS PROJECT,

MR. MANI MARAN

INFORMATION & GIVING ME AN OPPORTUNITY TO DO THE RESEARCH

PROJECT AT INDIA INFOLINE

ALMIGHTY FOR HIS BLESSINGS FOR THE COMPLETION OF THIS

ENDEAVOUR.

DATE JULY 3, 2009

PLACE CHENNAI


ACKNOWLDGEMENT

IT IS MATTER OF HONOUR TO EXPRESS MY GRATITUDE TOWAR

ME DIRECTLY OR INDIRECTLY IN COMPLETING THIS

PROJECT REPORT. I WOULD LIKE TO SPECIALLY THANK,

, FOR GUIDING ME AND FOR ALL SUPPORT AND FACILITIES

THROUGHOUT THIS PROJECT

PRAVEEN BHAGAWAN, FOR GIVING VALUABLE GUIDANCE TO ME

THROUGHOUT THIS PROJECT,

FOR PROVIDING VALUABLE DATA SOURCE,

GIVING ME AN OPPORTUNITY TO DO THE RESEARCH

INDIA INFOLINE CHENNAI, AND ABOVE ALL I THANK


JULY 3, 2009

CHENNAI

STUDENT NAME

SIGNATURE


Page | 3

R TO EXPRESS MY GRATITUDE TOWARDS ALL

OMPLETING THIS

ALL SUPPORT AND FACILITIES

DANCE TO ME

FOR PROVIDING VALUABLE DATA SOURCE,

GIVING ME AN OPPORTUNITY TO DO THE RESEARCH

ABOVE ALL I THANK


AMITH KUMAR G


COMPANY GUIDE’S CERTIFICATE

THIS IS TO CERTIFY THAT MR.

PROGRAMME OF BHAVAN

(BIMM). HE HAS CONDUCTED A STUDY ON “

PERFORMANCE OF IPO's IN THE INDIAN CAPITAL MARKET

INFOLINE FROM MAY 15

THE STUDENT HAS HAD PRELIMINARY AND INTERMITTENT DISCUSSIONS

DURING THE PROJECT PERIOD. I CERTIFY THAT THE PROJECT IS

PREPARED UNDER MY GUIDANCE.

DATE: JULY 3RD, 2009

PLACE: CHENNAI


COMPANY GUIDE’S CERTIFICATE

THAT MR. AMITH KUMAR G IS A STUDENT OF PGPM


(BIMM). HE HAS CONDUCTED A STUDY ON “A STUDY ON THE

PERFORMANCE OF IPO's IN THE INDIAN CAPITAL MARKET

MAY 15TH, 2009 TO JULY 3RD, 2009.



PREPARED UNDER MY GUIDANCE.

, 2009

NAME OF THE MANAGER MR. MANI MARAN

DESINATION BRANCH

COMPANY NAME INDIA INFOLINE

PLACE CHENNAI


Page | 4

G IS A STUDENT OF PGPM

S INSTITUTE OF MANAGEMENT – MYSORE

A STUDY ON THE

PERFORMANCE OF IPO's IN THE INDIAN CAPITAL MARKET” IN INDIA



MR. MANI MARAN

BRANCH MANAGER

INDIA INFOLINE

CHENNAI


***** ::: ***** ::: ***** ::: ***** :::

SI NO

1 EXECUTIVE SUMMARY

2 INDUSTRY PROFILE

3 ABSTRACT

4 OBTECTIVE OF THE STUDY

5 SCOPE OF

6 LIMITATION OF THE STUDY

7 COMPANY PROFILE

8 FIANANCE DEPARETMENT OF INDIA INFOLINE LTD

9 MARKETING DEPARETMENT OF

10 HR DEPARETMENT OF INDIA INFOLINE LTD

11 RECENT AWARDS & ACCOLADES


***** ::: ***** ::: ***** ::: ***** ::: TABLE OF CONTENTSTABLE OF CONTENTSTABLE OF CONTENTSTABLE OF CONTENTS ::: *****::: *****::: *****::: *****

PARTICULARS

EXECUTIVE SUMMARY

INDUSTRY PROFILE

2.1 ** INTRODUCTION

ABSTRACT

OBTECTIVE OF THE STUDY

SCOPE OF THE STUDY

LIMITATION OF THE STUDY

COMPANY PROFILE

7.1 ** INTRODUCTION

7.2 ** VISION

7.3 ** MISSION

7.4 ** MILESTONES

7.5 ** ORGANIZATION STRUCTURE

7.6 ** MANAGEMENT OF THE COMPANY

7.7 ** KET STRENGTHS

7.8 ** CORPORATE INFORMATION

FIANANCE DEPARETMENT OF INDIA INFOLINE LTD

MARKETING DEPARETMENT OF INDIA INFOLINE LTD

HR DEPARETMENT OF INDIA INFOLINE LTD

RECENT AWARDS & ACCOLADES


Page | 5

ORGANIZATION STRUCTURE

MANAGEMENT OF THE COMPANY

** CORPORATE INFORMATION

FIANANCE DEPARETMENT OF INDIA INFOLINE LTD

INDIA INFOLINE LTD

HR DEPARETMENT OF INDIA INFOLINE LTD


;’;’;’;’ ;’;’;’;’ ;’;’;’;’ ;’;’;’;’ RESEARCH REPORT CONTENTSRESEARCH REPORT CONTENTSRESEARCH REPORT CONTENTSRESEARCH REPORT CONTENTS

SI NO

1 INTRODUCTION TO IPO

2 IPO MARKET IN INDIA

3 IPO MARKET IN INDIA

4 CREDIT RATING IPO

5 CREDIT RATING AGENCIES

6 PRIMARY AND SECONDARY MARKET

7 BUYING IPO PROCESS

8 ISSUE PERIOD

9 ALLOMENT STATUS

11 IPO REFUND

12 IPO – ADVANTAGES

13 IPO – DISADVANTAGES

14 IPO PROCESS ( ISSUER’S PRESPECTIVE )

15 IPO PROCESS ( INVESTORS PERSPECTIVE )

16 RECENT TRENDS

18 IPO SCAMS OVERVIEW


RESEARCH REPORT CONTENTSRESEARCH REPORT CONTENTSRESEARCH REPORT CONTENTSRESEARCH REPORT CONTENTS ;’;’;’;’;’;’;’;’;’;’;’;’;’;’;’;’

PARTICULARS

INTRODUCTION TO IPO

IPO MARKET IN INDIA – OVERVIEW

IPO MARKET IN INDIA – REGULATION

CREDIT RATING IPO - IS IT MANDTORY

CREDIT RATING AGENCIES

PRIMARY AND SECONDARY MARKET

BUYING IPO PROCESS

ISSUE PERIOD

ALLOMENT STATUS

IPO REFUND

ADVANTAGES

DISADVANTAGES

IPO PROCESS ( ISSUER’S PRESPECTIVE )

IPO PROCESS ( INVESTORS PERSPECTIVE )

RECENT TRENDS

12.1 ** NHPC IPO FACT SHEET

12.2 ** ADANI POWER IPO FACT SHEET

IPO SCAMS OVERVIEW


Page | 6

;’;’;’;’;’;’;’;’;’;’;’;’;’;’;’;’

12.2 ** ADANI POWER IPO FACT SHEET


19 PUBLIC ISSUE CALENDER WISE SUMMARY

20 PUBLIC ISSUE FINANCIAL WISE SUMMARY

21 SWOT ANALYSIS

22 CONCLUSION

23 GLOSSARY

24 BIBLOGRAPHY

25 WEBLIOGRAPHY


13.1 ** ITS CAUSES

PUBLIC ISSUE CALENDER WISE SUMMARY

PUBLIC ISSUE FINANCIAL WISE SUMMARY

SWOT ANALYSIS

CONCLUSION

GLOSSARY

BIBLOGRAPHY

WEBLIOGRAPHY


Page | 7

PUBLIC ISSUE CALENDER WISE SUMMARY

PUBLIC ISSUE FINANCIAL WISE SUMMARY


### ### ### ### LIST OF TABLES IN THE LIST OF TABLES IN THE LIST OF TABLES IN THE LIST OF TABLES IN THE

SI NO

� VISION ELABORATED

� SHARE PRICE OF IIL IN BSE , NSE ON MARCH 31, 2009

� FINANCIAL PERFORMANCE OF IIL FOR THE YEAR 08

� SNAPSHOT OF STAND ALONE PERFORMANCE OF IIL

� CONSOLIDATED FINANCIAL PERFORMANCE OF IIL

� COMPARING REVENUES FROM THE YEAR 2005

� COMPARING EBIDTA FROM

� COMPARING PAT FROM THE YEAR 2005

� IPO GRADING

� RATING SYMBOLS

� IPO PROCESS ( ISSUERS PESPECTIVE )

� IPO PROCESS ( INVESTORS PERSPECTIVE )

� IPO’s DURING JAN

� COMPARISON OF IPO’s IN Q1’07 & Q1’08

� PUBLIS ISSUE

� PULBIC ISSUE


LIST OF TABLES IN THE LIST OF TABLES IN THE LIST OF TABLES IN THE LIST OF TABLES IN THE REPORTREPORTREPORTREPORT

PARTICULARS

VISION ELABORATED

PRICE OF IIL IN BSE , NSE ON MARCH 31, 2009

FINANCIAL PERFORMANCE OF IIL FOR THE YEAR 08

SNAPSHOT OF STAND ALONE PERFORMANCE OF IIL

CONSOLIDATED FINANCIAL PERFORMANCE OF IIL

COMPARING REVENUES FROM THE YEAR 2005

COMPARING EBIDTA FROM THE YEAR 2005-2009

COMPARING PAT FROM THE YEAR 2005-2009

IPO GRADING

RATING SYMBOLS & THEIR MEANING

IPO PROCESS ( ISSUERS PESPECTIVE )

IPO PROCESS ( INVESTORS PERSPECTIVE )

IPO’s DURING JAN - MARCH

COMPARISON OF IPO’s IN Q1’07 & Q1’08

PUBLIS ISSUE – CALENDER WISE

PULBIC ISSUE – FINANCIAL YEAR WISE


Page | 8

REPORTREPORTREPORTREPORT ############

PRICE OF IIL IN BSE , NSE ON MARCH 31, 2009

FINANCIAL PERFORMANCE OF IIL FOR THE YEAR 08-09

SNAPSHOT OF STAND ALONE PERFORMANCE OF IIL

CONSOLIDATED FINANCIAL PERFORMANCE OF IIL

COMPARING REVENUES FROM THE YEAR 2005-2009

2009


****************LLLLISISISIST OF CHARTS IN THE REPORTT OF CHARTS IN THE REPORTT OF CHARTS IN THE REPORTT OF CHARTS IN THE REPORT

SI NO

� ORGANIZATION STRUCTURE

� ORGANIZATION STUDY (INDIA INFOLINE)

� IIL SHARE PRICE VERSUS BSE SENSEX

� IIL SHARE PRICE VERSUS NSE S

� BUSINESS DIVISIONS

�

�

�

�

� IPO’s VERSUS SECONDARY ISSUES

� IPO’s DURING Q1’07 & Q1’08

� NUMBER OF ISSUES FROM 2004

� NUMBER OF ISSUES ( FINANCIAL YEAR WISE )

� CURRENT IPO REACTIONS


T OF CHARTS IN THE REPORTT OF CHARTS IN THE REPORTT OF CHARTS IN THE REPORTT OF CHARTS IN THE REPORT

PARTICULARS


ORGANIZATION STUDY (INDIA INFOLINE)

IIL SHARE PRICE VERSUS BSE SENSEX

IIL SHARE PRICE VERSUS NSE S&P CNX NIFTY

BUSINESS DIVISIONS

BROKING --- INDUSTRY OPTIMISM

CREDIT & FINANCE --- INDUSTRY OPTIMISM

INSURANCE --- INDUSTRY OPTIMISM

WEALTH ASSET MANAGEMENT – INDUSTRY OPT.

IPO’s VERSUS SECONDARY ISSUES

IPO’s DURING Q1’07 & Q1’08

NUMBER OF ISSUES FROM 2004-2009

NUMBER OF ISSUES ( FINANCIAL YEAR WISE )

CURRENT IPO REACTIONS


Page | 9

T OF CHARTS IN THE REPORTT OF CHARTS IN THE REPORTT OF CHARTS IN THE REPORTT OF CHARTS IN THE REPORT ****************

&P CNX NIFTY

INDUSTRY OPTIMISM

INDUSTRY OPTIMISM

INDUSTRY OPTIMISM

INDUSTRY OPT.

NUMBER OF ISSUES ( FINANCIAL YEAR WISE )


EXECUTIVE SUMMARY

The MBA course offered by the

MANAGEMENT, MYSORE

requires its MBA students to undertake an internship with any of the

leading business houses for a period ranging from 6 to 8 weeks

during the first year holidays. The purpose of this internship is to

enable the students

the practical world vis

practical exposure and come out with creative solutions/ ideas in

enhancing the business. In practical fulfillment of MBA degree of

BIMM I took up an Organizational study at India Infoline Chennai. I

have experienced the heat of work for almost three months and it

was really a great exposure in the corporate world. I have learned a

lot regarding the workings of various departments and mainly the

finance and it was really great working for someone.


EXECUTIVE SUMMARY

The MBA course offered by the BHAVANS INSTITUTE OF

MYSORE has its own unique syllabus which




enable the students to appreciate and understand the nuances of

the practical world vis-à-vis the theoretical inputs with those of



p an Organizational study at India Infoline Chennai. I




nance and it was really great working for someone.


Page | 10

BHAVANS INSTITUTE OF

has its own unique syllabus which




to appreciate and understand the nuances of

vis the theoretical inputs with those of



p an Organizational study at India Infoline Chennai. I





& * @ $ % @ ^ * } #

*** INDUSTRY PROFILE *

# } * ^ @ % $ @ * &


& * @ $ % @ ^ * } #

INDUSTRY PROFILE *

# } * ^ @ % $ @ * &


Page | 11

& * @ $ % @ ^ * } #

INDUSTRY PROFILE ***

# } * ^ @ % $ @ * &


INTRODUCTION

Change is the only constant in today’s capital markets. New

products and services are created everyday and they impact

consumers, financial service provider’s delivery systems and

regulations. This change presents a constant challenge for a

publication dev

The equity trading is the buying and selling of equities i.e.

good, product, raw material at the prevailing price rate for

immediate settlement. The exchange of equities will not be in

physical. It is a speculative market i.e

decrease of prices of the equities can be enjoyed in the way of

profit or loss. When there is the monetary flow in the

transactions, the emotional feeling will be impact on this

activity. The equities are traded in the exchanges. The

exchanges are the free market where forces that influences

price are brought together in open auction.


INTRODUCTION





publication devoted to the capital markets.




physical. It is a speculative market i.e. the increase or





anges are the free market where forces that influences

price are brought together in open auction.


Page | 12








. the increase or





anges are the free market where forces that influences


Some of the major equity exchanges around the globe are

NASDAQ, NSE, SENSEX, BSE, and NIKKIE. Spot equities

trading are done based on the future price.

These transactions are not bound to any particular exchange

or national boundaries, but are spec

risk Premium/ discount are offered on the prevailing futures

rate, which vary minute to minute depending upon the market

Psychology and supply/ demand gap

requested for, two quotes are offered by the dealer i.e. a bid

rate or sell rate and an ask rate or buy rate.

Indian stock exchanges have evolved in

years. Gone are the days when one would see brokers

shouting to place the orders to other jobbers or broker

upon a time, brokers used to killing on the commission they

used to earn on new issues just by lending their name

through “BROKERS TO THE ISSUE”.




trading are done based on the future price.


or national boundaries, but are speculative in nature. A small

Premium/ discount are offered on the prevailing futures


and supply/ demand gap whenever


rate or sell rate and an ask rate or buy rate.

Indian stock exchanges have evolved in the last couple of

Gone are the days when one would see brokers

shouting to place the orders to other jobbers or broker



through “BROKERS TO THE ISSUE”.


Page | 13




ulative in nature. A small

Premium/ discount are offered on the prevailing futures


a quote is


the last couple of

Gone are the days when one would see brokers

shouting to place the orders to other jobbers or brokers. Once




There were hundreds of new issues tapping the market in just

one week, making it tough to track w

exchange but today almost all the exchanges barring BSE &

NSE are finding it tough to remain float.

The Indian primary market has come a long way particularly

in the last decade after deregulation of the Indian economy in

1991-92. Both

their fair share of reforms, structural cum policy changes time

to time. The most commendable being the dismantling of the

Controller of Capital Issues (CCI) and introduction of the free

pricing mechanism. This ch

Public Offering (IPO) market.

But in last ten years or so, the scenario has changed for the

better. Online trading is a reality with much better

transparency than the previous system. We have SEBI which

has a better grip ov

the past.



one week, making it tough to track which has one active


NSE are finding it tough to remain float.



92. Both the primary and secondary markets have had




pricing mechanism. This changed the whole facet of Initial

Public Offering (IPO) market.




has a better grip over the market nuisance that was there in


Page | 14


hich has one active




the primary and secondary markets have had




anged the whole facet of Initial




er the market nuisance that was there in


ABSTRACT

The study

Indian capital market

Securities, Chennai. India Infoline Securities is

in the field of Equity trading. They have major client base and

working grateful to their clients.

The major objective of the project is to study about

the overview of Indian equ

raise the IPO's to list in the Indian stock exchange and to

analyze the recent trends of the IPO's

and disadvantages

in equity market.

Secondary

going through

business standards magazines


The study “A study on the performance of IPOs in the

Indian capital market” has been carried out at India

ities, Chennai. India Infoline Securities is a growing firm


working grateful to their clients.


overview of Indian equity market and the procedure to


analyze the recent trends of the IPO's with their advantages

and disadvantages in the last couple of years for the traders

y market.

Secondary data for the study was collected from

going through the various records of the company such as

business standards magazines, websites, articles etc.


Page | 15

the performance of IPOs in the

India Infoline

a growing firm



procedure to


with their advantages

in the last couple of years for the traders

study was collected from

records of the company such as

, articles etc.


OBJECTIVE OF THE STUDY

� To know the

� To know the functions of various department such as

Finance, Marketing,

� To understand the work culture

� To develop necessary interpersonal and managerial skills

� To gain well rounded view of management operations.

� To gain firsthand

� To make an assessment of the organization in the industry.

� To find out marker share of the company,

the company.



To know the Organization structure of the India Infoline

To know the functions of various department such as

arketing, Human resource management.

To understand the work culture of India Infoline

develop necessary interpersonal and managerial skills

To gain well rounded view of management operations.

To gain firsthand experience from industry.

To make an assessment of the organization in the industry.

To find out marker share of the company, it’s positioning of

the company.


Page | 16


ization structure of the India Infoline

To know the functions of various department such as

uman resource management.

of India Infoline

develop necessary interpersonal and managerial skills

To gain well rounded view of management operations.

To make an assessment of the organization in the industry.

positioning of


The scope is limited to the extent of

Organization and their information collected during the

project. It is done as a part of academic study. The scope of

the study limited to information supplied by the department

head and information collected by standing order and

settlement knowledge

course. The study is confined only to India Infoline Chennai


SCOPE OF THE STUDY

The scope is limited to the extent of the place, time.

rganization and their information collected during the




settlement knowledge gained by the student the study of the

course. The study is confined only to India Infoline Chennai


Page | 17

the place, time. The

rganization and their information collected during the




gained by the student the study of the

course. The study is confined only to India Infoline Chennai.



The study is not proposed to be an expert study as it was

done by a student for the purpose of a partial fulfillment of

the course in the plant training, which is an integral part, in

completion and reward of MBA.

short span of eight weeks, so the findings cannot be

generalized for all times. Some of the information’s being

confidential was not incl

study, by and large is very vast. It is very difficult to satisfy

all the areas. Therefore an attempt is made to cover as much

as possible.





course in the plant training, which is an integral part, in

completion and reward of MBA. The study was conducted in a



confidential was not included in the study. The scope of the




Page | 18




course in the plant training, which is an integral part, in

The study was conducted in a



uded in the study. The scope of the




& & & & & & & &

** COMPANY PROFILE

& & & &


& & & & & & & & & &

COMPANY PROFILE

& & & & & & & & & &


Page | 19

& &

COMPANY PROFILE **

& & & & & &


IT’S ALL ABOUT MONEY, HONEY!




Page | 20



INTRODUCTION

India Infoline was originally incorporated on October 18,

1995 as Probity Research and Services Private Limited at

Mumbai under the Companies Act, 1956 with Registration No.

11 93797. They commenced their

independent provider of informatio

covering Indian businesses, financial markets and economy,

to institutional customers.

company on April 28, 2000 and the name of the Company

was changed to Probity Research and Services Limited. The

name of the Company was changed to India Infoline.com

Limited on May 23, 2000 and later to India Infoline Limited on

March 23, 2001.

In 1999, they

to a Mass retail segment and transformed our business model

from providing information services to institutional customers

to retail customers.


INTRODUCTION




They commenced their operations as an

independent provider of information, analysis and research


to institutional customers. They became a public limited



e of the Company was changed to India Infoline.com


March 23, 2001.

they identified the potential of the Internet to cater



to retail customers.


Page | 21




operations as an

n, analysis and research


became a public limited



e of the Company was changed to India Infoline.com


identified the potential of the Internet to cater




India infoline is a

across 1361 business locations and a presence in 428 cities.

Our global footprint extends across geograph

New York, Singapore & Dubai. We are listed on the BOMBAY

STOCK EXCHANGE (BSE)

(NSE).

India infoline offers a wide range of services & product

comprising broking, wealth management, credit & finance,

insurance, asset management & investment banking.

India Infoline are registered with the BSE and NSE for

securities trading, MCX, NCDEX and DGCX for commodities

trading, CSDL & NSDL as depository participants. India

Infoline are registered as a category I merchant

are a SEBI registered portfolio manager. They also received

the FII license in IIFL Inc. IIFL securities pte ltd received

approval from the monetary authority of Singapore to carry

out corporate advisory and dealing in securities operations.


India infoline is a Pan-India financial services organization


Our global footprint extends across geographies with offices in


STOCK EXCHANGE (BSE) & NATIONAL STOCK EXCHANGE



asset management & investment banking.




Infoline are registered as a category I merchant






Page | 22

financial services organization


ies with offices in


& NATIONAL STOCK EXCHANGE



asset management & investment banking.




Infoline are registered as a category I merchant banker and






Two subsidiaries

Credit Limited are registered with RBI as non

Non-banking financial services

Housing Finance ltd, the housing finance arm, is registered

with the National Housing Bank.

In May 2000, the name of Company was changed to India

Infoline.com Limited to reflect the transformation of

business over a period

the leading business and financial information services

provider in India.

the brand name of 5paisa.com through

Infoline Securities Private Limited and w

E-broking portal, was launched for online trading in July 2000.

It combined competitive brokerage rates and research,

supported by Internet technology besides investment advice

from an experienced team of research analysts,

offer real time stock quotes, market news and price charts

with multiple tools for technical analysis.


Two subsidiaries- India Infoline Investment Services & Money

Credit Limited are registered with RBI as non-deposit taking

financial services companies. India Infoline


with the National Housing Bank.


Infoline.com Limited to reflect the transformation of

business over a period of time, we have emerged as one of


provider in India. Their broking services was launched under

the brand name of 5paisa.com through their subsidiary, India

Infoline Securities Private Limited and www.5paisa.com

broking portal, was launched for online trading in July 2000.



from an experienced team of research analysts,

er real time stock quotes, market news and price charts

with multiple tools for technical analysis.


Page | 23

India Infoline Investment Services & Money

deposit taking

companies. India Infoline



Infoline.com Limited to reflect the transformation of their

of time, we have emerged as one of


broking services was launched under

subsidiary, India

ww.5paisa.com, the

broking portal, was launched for online trading in July 2000.



from an experienced team of research analysts, they also

er real time stock quotes, market news and price charts


Acquisition of Agri Marketing Services Limited (Agri)

In March 2000,

Agri Marketing

exchange for the issuance of 508,482 of

Agri was a direct selling agent of personal financial products

including mutual funds, fixed deposits, corporate bonds and

post-office instruments. At the t

operated 32 branches in South and West India serving more

than 30,000 customers with a staff of, approximately 180

employees. After the acquisition,

name to India Infoline.com

Facilities

India Infoline’s

approximately 4,000 square feet of office space located in

Mumbai, India

additional 10,000 square feet of office space located

throughout India.

Rs 70 and Rs 80 for its forthcoming public issue.


Acquisition of Agri Marketing Services Limited (Agri)

In March 2000, they acquired 100% of the equity shares of

Agri Marketing Services Limited, from their owners in

exchange for the issuance of 508,482 of their equity shares



office instruments. At the time of our acquisition, Agri



employees. After the acquisition, they changed the company

India Infoline.com Distribution Company Limit

India Infoline’s main offices are located in


Mumbai, India and the Branches collectively occupy an


throughout India. India Infoline fixed a price band between



Page | 24

acquired 100% of the equity shares of

Services Limited, from their owners in

equity shares



ime of our acquisition, Agri



changed the company

Distribution Company Limited.

main offices are located in


Branches collectively occupy an


a price band between



The company came out with public

shares with a face value of Rs 10 through the

route the issue is slated to open on April 21 and close on

April 27. Enam Financial Consultants Private Ltd would be

the sole book running lead manager to the issue while

Intime Spectrum Registry

India Infoline public i

Entering into the internet pioneer in online trading:

Company saw an opportunity to expand client base, from a

few hundred to several millions and also to complete the

value chain. In early 1999, when internet penetration in India

was at its infancy and the future unknown, company took

hard decision of killing their business model and embracing

the internet.

Company disconti

made available quality research at the click of a mouse. Thus,

was born www.indiainfoline.com

most popular company


The company came out with public issue of

with a face value of Rs 10 through the book building

issue is slated to open on April 21 and close on


book running lead manager to the issue while

Spectrum Registry Ltd is the registrar to the issue.

India Infoline public issue gets 6.6 times oversubscription

Entering into the internet pioneer in online trading:


to several millions and also to complete the




Company discontinued delivery of reports in printed form and


www.indiainfoline.com.The site has emerged as the

most popular company by site on Indian business and finance.


Page | 25

1.18 crore

book building

issue is slated to open on April 21 and close on


book running lead manager to the issue while

Ltd is the registrar to the issue.

oversubscription


to several millions and also to complete the




nued delivery of reports in printed form and


.The site has emerged as the

by site on Indian business and finance.


India Infoline is a stop financial services shop, most respected

for quality of its advice, personalized service and cutting

technology. It is among the largest; most diversified and de

risked financial servic

INDIA INFOLINE’S

� Started in 1995 as an independent business research

and information services provider and now involved

into a one stop financial services provider

� Managed by component professionals with impeccable

track recor

Indian financial

INDIA INFOLINE’S

� Broking (retail & institutional, equities and commodities)

� Credit and finance

� Asset management

� Wealth management

� Insurance

� Investment


nfoline is a stop financial services shop, most respected

for quality of its advice, personalized service and cutting

It is among the largest; most diversified and de

risked financial services players in India today

INDIA INFOLINE’S PEDIGREE

Started in 1995 as an independent business research


into a one stop financial services provider

Managed by component professionals with impeccable

record and with a deep understanding of the

financial services space

INDIA INFOLINE’S PRODUCT OFFERINGS

(retail & institutional, equities and commodities)

and finance

management

management

Insurance distribution

Investment banking


Page | 26

nfoline is a stop financial services shop, most respected

for quality of its advice, personalized service and cutting-edge

It is among the largest; most diversified and de-

es players in India today

Started in 1995 as an independent business research


Managed by component professionals with impeccable

d and with a deep understanding of the

(retail & institutional, equities and commodities)


INDIA INFOLINE’S

�

�

�

COMMENCED OPERATION

�

PROMOTER’S HOLDINGS

�

�


INDIA INFOLINE’S PRESENCE

Headquarters in Mumbai, India

� Pan-India distribution network

(607 branches, 151 franchisees)

In 346 cities; international presence

In Dubai, New York and Singapore

Listed in BSE & NSE

COMMENCED OPERATION

In the year 1995

PROMOTER’S HOLDINGS

33.4 %

As on March 31, 2008

FII Holding

27.5 %



Page | 27

franchisees)

In 346 cities; international presence

In Dubai, New York and Singapore


�

�

INDIA INFOLINE’S

www.indiainfoline.com

as the most comprehensive information resource centre with an

incisive analysis of Indian business, finance and investments.

INDIA INFOLINE’S M

# NSE, BSE (securities trading)

# MCX, NCDEX and DGCX (commodities trading)

# NSDL and CDSL (depository participant)

# Registered as a category

# SEBI- registered Portfolio Manager.

# India Infoline Investment Services ltd And Moneyline

credit Ltd are registered with RBI as non

accepting


India Infoline team

14000+


India Infoline clients

300,000+


INDIA INFOLINE’S PORTAL

www.indiainfoline.com, the company’s flagship portal, is recognized



INDIA INFOLINE’S MEMBERSHIP

NSE, BSE (securities trading)

MCX, NCDEX and DGCX (commodities trading)

NSDL and CDSL (depository participant)

Registered as a category-1 merchant banker.

registered Portfolio Manager.

India Infoline Investment Services ltd And Moneyline

credit Ltd are registered with RBI as non-deposit

accepting non- Banking financial companies


Page | 28

, the company’s flagship portal, is recognized



MCX, NCDEX and DGCX (commodities trading)

1 merchant banker.

India Infoline Investment Services ltd And Moneyline

deposit


To become the most respected company in the financial

VISION ELABORATED FROM THE PERSPECTIVE

OF VARIOUS

TABLE - 1

EmployeesEmployeesEmployeesEmployees

Best place to

work in

deliver value

Rewarding

Career experience

Personal

development

transparency


VISION


services space.


OF VARIOUS CONSTITUENCIES

CustomersCustomersCustomersCustomers

ShareholdersShareholdersShareholdersShareholders

deliver value

de-Risked

business

delightful

experience

sustained

growth

integrity &

transparency

High

returns


Page | 29



CONSTITUENCIES

SocietySocietySocietySociety

Governance

innovation

global

respect


To become a full-fledged services company known for its quality of

advice, personalized service and cutting

INDIA INFOLINE’S

Incorporated as an equity research and resulting firm with a client

base that includes leading FIIs, banks, consulting firms and

Restructured the business model to embrace the internet;

Launched

from reputed private equity investors

Commenced the distribution of personal financial products;

Entered life insurance distribution as a corporate agent;

Acknowledged by Forbes as

Launched online equity trading


MISSION

fledged services company known for its quality of

advice, personalized service and cutting-edge technology

INDIA INFOLINE’S MILESTONES

In the year 1995



corporate

In the year 1999


Launched www.indiainfoline.com; mobilized capital

from reputed private equity investors

In the year 2000



Acknowledged by Forbes as “best of the web” & must read for investors

Launched online equity trading


Page | 30

fledged services company known for its quality of

edge technology




; mobilized capital



of the web” & must read for investors


Acquired comm

Launched portfolio Management Service;

Listed on the Indian stock markets

Acquired membership of DGCX;

Launched banking services;

Formed a Singapore subsidiary;

Rose over USD 30

Launched a proprietary trading platform;

Included as institutional equities team from the incumbent leader;

Launched consumer finance business under the “Moneyline” brand;


In the year 2004

Acquired commodities broking license;

Launched portfolio Management Service;

In the year 2005

Listed on the Indian stock markets

In the year 2006

Acquired membership of DGCX;

Launched banking services;

In the year 2007

Formed a Singapore subsidiary;

Rose over USD 300 mn in the group;

Launched a proprietary trading platform;




Page | 31




Launched wealth management services under the

Set up India infoline private equity fund;

Received the insurance broking license from IRDA;

Received the venture capitalist license;

Received in-principle approval to sponsor a mutual fund;

Received ‘best broker

‘Most improved brokerage

Received registration for a housing

Expanding geographical presence to 100 key locations in 2008

Leverage India Infoline’

Innovation in distribution channels to increase awareness and volumes.

Introduce new products to match diverse credit needs;

Focused on maintaining portfolio quality by catering to the mid prime and

prime customer segments having proven credit performance;

Improve customer servicing through multiple touch points;

Continuous investments in technology to simplify processes and system;


In the year 2008

Launched wealth management services under the “IIFL Wealth” brand;

Set up India infoline private equity fund;


Received the venture capitalist license;

principle approval to sponsor a mutual fund;

Received ‘best broker-India’ award from FINANCE

‘Most improved brokerage- India ‘award from ASIAMONEY;

In the year 2009

Received registration for a housing finance company from the national

housing bank;

Expanding geographical presence to 100 key locations in 2008

Leverage India Infoline’s existing distribution network to expand reach.




customer segments having proven credit performance;




Page | 32

“IIFL Wealth” brand;


principle approval to sponsor a mutual fund;

ANCEASIA;

ASIAMONEY;

finance company from the national

Expanding geographical presence to 100 key locations in 2008-09;

s existing distribution network to expand reach.




customer segments having proven credit performance;








Page | 33


ORGANIZATION


ORGANIZATION STUDY OF THE INDIA INFOLINE


Page | 34

STUDY OF THE INDIA INFOLINE


INDIA INFOLINE GROUP

� It comprising the holding company, its wholly

subsidiaries, straddle the entire financial services space

with offerings ranging from


NFOLINE GROUP

It comprising the holding company, its wholly


with offerings ranging from

� Equity research,

� Equities and derivatives trading,

� Commodities trading,

� Portfolio Management Services,

� Mutual Funds,

� Life Insurance,

� Fixed deposits,

� Government bonds

� other small savings instruments to loan

products and Investment banking


Page | 35

It comprising the holding company, its wholly-owned


Equities and derivatives trading,

Portfolio Management Services,

other small savings instruments to loan

products and Investment banking


INDIA INFOLINE LTD

� Listed in both the leading stock

viz. the Bombay stock exchange {BSE} and the

national stock exchange {NSE}

� It is also the member of both the exchanges.

� It has signed in the businesses of Equities Broking,

Wealth Advisory Services, and Portfolio Management

Services

� It offers broking services in the cash & derivatives

segments of the NSE as well as in the BSE.

� It has been registered with NSDL and CDSL as a

depository participant.


INDIA INFOLINE LTD

Listed in both the leading stock exchanges in India,


national stock exchange {NSE}

It is also the member of both the exchanges.

It has signed in the businesses of Equities Broking,


Services

It offers broking services in the cash & derivatives


It has been registered with NSDL and CDSL as a

depository participant.


Page | 36

exchanges in India,


It is also the member of both the exchanges.

It has signed in the businesses of Equities Broking,


It offers broking services in the cash & derivatives


It has been registered with NSDL and CDSL as a


INDIA INFOLINE MEDIA & RESEARCH SERVICES

LIMITED.

It executes the equities

none other than Forbes as “Best of the Web” and “A must

read for inventors in Asia

India Infoline's research is available not just over the internet

but also on international wire services like Bloomberg.

INDIA INFOLINE

� Engaged in the business of commodities broking

� with the requisite skills and technologies to allow us offer

commodities broking as a contra

equities broking

two leading India

acquired membership of DGCX

� Multi-channel

few to offer online as well as offline trading facilities



It executes the equities research which is acknowledged by


read for inventors in Asia”



INDIA INFOLINE COMMODITIES LIMITED

Engaged in the business of commodities broking

with the requisite skills and technologies to allow us offer

commodities broking as a contra-cyclical alternative to

equities broking memberships with the MCX and NCDEX,

two leading Indian commodities exchanges, and recently

acquired membership of DGCX

channel delivery model, making it among the select

few to offer online as well as offline trading facilities


Page | 37


research which is acknowledged by




Engaged in the business of commodities broking

with the requisite skills and technologies to allow us offer

cyclical alternative to

the MCX and NCDEX,

n commodities exchanges, and recently

delivery model, making it among the select

few to offer online as well as offline trading facilities.


INDIA INFOLINE

It is the holding company of India

limited & India

� India Infoline Insurance Services Limited is a registered

Corporate Agent with the Insurance Regulatory and

Development Authority (IRDA). It

Agent for ICICI Prudential Life Insurance Co Limited, which

is India's largest private Life Insurance Company. India

Infoline was the first corporate agent to get licensed by

IRDA in early 2001.

� India Infoline Insurance Brokers L

Insurance Brokers Limited is a newly formed subsidiary

which will carry out the business of Insurance broking. We

have applied to IRDA for the insurance broking license and

the clearance for the same is awaited. Post the grant of

license, we propose to also commence the general

insurance distribution business


INDIA INFOLINE MARKETING AND SERVICES

It is the holding company of India Infoline insurance services

limited & India Infoline insurance brokers limited.

India Infoline Insurance Services Limited is a registered


Development Authority (IRDA). It is the largest Corporate




IRDA in early 2001.

India Infoline Insurance Brokers Limited India Infoline





nse, we propose to also commence the general

insurance distribution business.


Page | 38

ERVICES

insurance services

India Infoline Insurance Services Limited is a registered


is the largest Corporate




imited India Infoline





nse, we propose to also commence the general


INDIA INFOLINE OUTLET OFFERS

� Online BSE & NSE executions(NEAT &

NEAT

BOLT

� Commodities t

� Depository services � IPO’s and mutual fund distribution � Derivatives trading ( futures & options )

� Personalized advice � Live market information � Daily market research and market information � Fairly trading call based on

PRODUCTS AND S

� Online And Offline Trading

� Equity Trading

� Commodity Trading

� Insurance

� Mutual Funds

� Postal Savings

� Market Data And Fund Statistics


INDIA INFOLINE OUTLET OFFERS

ne BSE & NSE executions(NEAT & BOLT terminal)

NEAT -- National Exchange Automated Trading

BOLT -- BSE On Line Trading

Commodities trading

Depository services – Demat & Remat format

IPO’s and mutual fund distribution

Derivatives trading ( futures & options )

Personalized advice

Live market information

Daily market research and market information

Fairly trading call based on technical analysis

PRODUCTS AND SERVICES

Online And Offline Trading

Equity Trading

Commodity Trading

Insurance

Mutual Funds

Postal Savings

Market Data And Fund Statistics


Page | 39

BOLT terminal)

National Exchange Automated Trading

Demat & Remat format

Daily market research and market information

technical analysis


QUALITY ASSURANCE POLICY

We are committed to being the Leader in providing

Class Products & Services which exceed the expectations of

our customers achieved by teamwork and a process of

continuous improvement

� To effectively meet the customers’ requirements

and Endeavour to achieve total customer satisfaction.

� To gai

customers and potential customers regarding the

quality of services rendered.

� To pursue excellence through continuous

improvement in all areas & distinguish ourselves by

the quality of services.

BUSINESS PHILO

• Ethical practices & transparency in all our dealings

• Customers interest above our own

• Always deliver what we promise

• Effective cost management


QUALITY ASSURANCE POLICY

We are committed to being the Leader in providing



continuous improvement.

To effectively meet the customers’ requirements


To gain the consistent faith and confidence of


quality of services rendered.

To pursue excellence through continuous


the quality of services.

BUSINESS PHILOSOPHY

Ethical practices & transparency in all our dealings

Customers interest above our own

Always deliver what we promise

Effective cost management


Page | 40

We are committed to being the Leader in providing World



To effectively meet the customers’ requirements


n the consistent faith and confidence of


To pursue excellence through continuous


Ethical practices & transparency in all our dealings


MANAGEMENT

Mr. Nirmal Jain

Chairman & Managing Director

India Infoline ltd

Nirmal Jain, MBA (IIM, Ahmedabad) and a Chartered

and Cost

services company India Infoline Ltd. in 1995, providing

globally acclaimed financial services in equities and

commodities broking, life i

distribution, among others.

Mr. Nirmal

Lever’s commodity export business, contributing

tremendously to its growth.

Inquire-Indian Equity Research, which he

1994 to set new standa


ANAGEMENT TEAM OF INDIA INFOLINE

Jain


Infoline ltd


and Cost Accountant founded India’s leading financial



commodities broking, life insurance and mutual funds

distribution, among others.

Nirmal Jain began his career in 1989 with Hindustan


tremendously to its growth. He was also associated with

Indian Equity Research, which he co

1994 to set new standards in equity research.


Page | 41

INFOLINE


founded India’s leading financial



nsurance and mutual funds

Jain began his career in 1989 with Hindustan


He was also associated with

co-founded in

rds in equity research.


Mr. R Venkatraman Executive Director India Infoline ltd

R Venkatraman, co

India Infoline

communications

(IIM Bangalore

July 1999.

He previously held senior managerial positions in ICICI

ltd, including ICICI securities ltd, their investment

banking joint venture with J P Morgan of USA and with

BZW and Taib capital corporation ltd.

He was also Assistant Vice president

Services India Limited in their private equity division,

possessing a varied experience of more than 16 years in

the financial services sector


Mr. R Venkatraman

Executive Director

nfoline ltd

R Venkatraman, co-promoter & Executive Director of

Infoline ltd., is a B. Tech (electronics & electrical

communications engineering, IIT Kanpur) and an MBA

(IIM Bangalore) He joined the India Infoline

July 1999.




BZW and Taib capital corporation ltd.

He was also Assistant Vice president with G



the financial services sector.


Page | 42

promoter & Executive Director of

electronics & electrical

and an MBA

Infoline board in




with G E Capital




CORPORATE INFORMATION

Committee of Board

Audit Committee


CORPORATE INFORMATION (MANAGEMENT TEAM)

Mr. Nirmal Jain


Mr R. Venkataraman

Executive Director

Mr Sat Pal Khattar

Non Executive Director

Mr Nilesh Vikamsey

Independent Director

Mr Kranti Sinha


Mr A.K. Purwar


Mr Nilesh Vikamsey, Chairman

Mr Sat Pal Khattar

Mr Kranti Sinha


Page | 43

(MANAGEMENT TEAM)


Compensation/ Remuneration Committee

Share Transfer and Investor Grievance Committee

Chief Financial Officer

Company Secretary

Core Management team


Compensation/ Remuneration Committee

Mr Kranti Sinha, Chairman

Mr Nilesh Vikamsey

Mr Sat Pal Khattar

Share Transfer and Investor Grievance Committee

Mr Kranti Sinha, Chairman

Mr Nirmal Jain

Mr R. Venkataraman

Chief Financial Officer

Mr Kapil Krishan

Mr Nimish Mehta

Core Management team

Mr Bharat Parajia

MD, IIFL (Asia) Pte Ltd


Page | 44



Mr Apul Nayyar

CEO, Moneyline Credit Ltd

Mr Karan Bhagat

CEO, IIFL Wealth Management Ltd

Mr H. Nemkumar

President, Institutional Equities

Mr Aniruddha Dange

Head of Research, Institutional Equities

Mr Vasudev Jagannath

Head of Sales, Institutional Equities

Mr Ajit Menon

President, Investment Banking

Mr Donald D'Souza

President, Investment Banking

Mr R. Mohan

Chief Compliance Officer


Page | 45

Management Ltd

Head of Research, Institutional Equities

Head of Sales, Institutional Equities


Chief Operating Officer

Chief Internal Auditor

Chartered Accountants

Chartered Accountants

Registered Office

Building No. 75, Nirlon Complex,

Off: western express highway,

Goregaon (East), Mumbai


Chief Operating Officer

Mr Sanjeev Sandh

Chief Internal Auditor

M/s Sharp & Tannan Associates

Chartered Accountants Internal Auditors

M/s Kalyaniwalla & Mistry

Chartered Accountants Registrar and Share Transfer Agents

Intime Spectrum Registry Ltd

C-13, Pannalal Silk Mills Compound,

L.B.S. Marg, Bhandup (West),

Mumbai - 400 078

Building No. 75, Nirlon Complex,

Off: western express highway,

Goregaon (East), Mumbai - 400 063


Page | 46

Registrar and Share Transfer Agents

13, Pannalal Silk Mills Compound,


FINANCIAL DEPARTMENT OF INDIA INFOLINE

Table shows the monthly high, low quotations of shares traded at

BSE, NSE for the current year march 31, 2009


DEPARTMENT OF INDIA INFOLINE


BSE, NSE for the current year march 31, 2009


Page | 47

DEPARTMENT OF INDIA INFOLINE



India infoline ltd share price versus BSE Sensex

India Infoline share price v



Infoline share price vs NSE S&P CNX Nifty


Page | 48


NX Nifty


A snapshot of the financial performance of the company and its

major subsidiaries for the financial year 2008



major subsidiaries for the financial year 2008-09 is as follows,


Page | 49


09 is as follows,


A snapshot of the stand


A snapshot of the stand-alone financial performance of IIL,


Page | 50

alone financial performance of IIL,


A snapshot of consolidated financial


A snapshot of consolidated financial performance is as under,


Page | 51

performance is as under,


RETROSPECTS IN 2007

PROFITABILITY

� 610-Basis point increase in EBIDTA margin from 33.2%

in 2006-07 to 39.3% in 2007

� 70 basis point increase in net margin from 26.9% 2006

07 to 27.6% in 2007

� 25.3% return on

compared to 28.7 in 2006

SHAREHOLDER VALUE

� Enhanced basis earnings per share from Rs 16.3 in

2006-07 to Rs 35.6 in 2007

� A final dividend of Rs 6 per share translating to a payout

ratio of 25.1% in 2007

2006-07

� Proposed 1:5 stock splits.


RETROSPECTS IN 2007 – 2008

Basis point increase in EBIDTA margin from 33.2%

07 to 39.3% in 2007-08.

70 basis point increase in net margin from 26.9% 2006

07 to 27.6% in 2007-08

25.3% return on average capital employed n 2007

compared to 28.7 in 2006-07

SHAREHOLDER VALUE

Enhanced basis earnings per share from Rs 16.3 in

07 to Rs 35.6 in 2007-08

A final dividend of Rs 6 per share translating to a payout

ratio of 25.1% in 2007-08 against Rs 3 per share in

Proposed 1:5 stock splits.


Page | 52

Basis point increase in EBIDTA margin from 33.2%

70 basis point increase in net margin from 26.9% 2006-

average capital employed n 2007-08

Enhanced basis earnings per share from Rs 16.3 in

A final dividend of Rs 6 per share translating to a payout

Rs 3 per share in


Like the six different bright

Infoline has six distinct business groups

financial services. Each of the individual businesses has bright

growth prospects and together they from the cube of financial


Like the six different bright colors of the Rubik’s cube, India

has six distinct business groups – all an integral part of



services


Page | 53

of the Rubik’s cube, India

all an integral part of




BUSINESS DIVISION --

� BROKING

� Market share of equities on the NSE increased from 3.4% in 2007

to 3.76% in 2008

� Customer base for retail equities increased 35.8% to .6% mn;

� Published in-

politics, rural India,


-- PERFORMANCE HIGHLIGHTS 200

BROKING

Market share of equities on the NSE increased from 3.4% in 2007

to 3.76% in 2008-09;

Customer base for retail equities increased 35.8% to .6% mn;

-depth & thematic reports on INCH (India & China),

politics, rural India, infrastructure, soft commodities, utilities.


Page | 54

PERFORMANCE HIGHLIGHTS 2008-2009

Market share of equities on the NSE increased from 3.4% in 2007-08

Customer base for retail equities increased 35.8% to .6% mn;

depth & thematic reports on INCH (India & China),

infrastructure, soft commodities, utilities.


� CREDIT & FINANCE

� Proactively suspended personal loans & mortgages business from

Sept.2008. while personal loans business is still suspended, the mortgages

business is restarted;

� Revenue at Rs 2654.1 mn

� Registered the housing finance subsidiary with NHB;


CREDIT & FINANCE

Proactively suspended personal loans & mortgages business from


business is restarted;

Revenue at Rs 2654.1 mn against 1937.5 mn in 2007-08;

Registered the housing finance subsidiary with NHB;


Page | 55

Proactively suspended personal loans & mortgages business from


08;




Page | 56


� INSURANCE

� Received insurance broking license

� Forged alliances with major insurance co. for the distribution or life & non

life insurance products;

� Altered the product mix in favor of traditional


Received insurance broking license

Forged alliances with major insurance co. for the distribution or life & non

life insurance products;

Altered the product mix in favor of traditional products endowment prod.


Page | 57

Forged alliances with major insurance co. for the distribution or life & non-

products endowment prod.


WEALTH & ASSET MANAGEMENT

� Introduced the ‘family office’ platform;

� Raised Rs 1.8 bn in the largest single day debenture listing

� Received in principle approval for setting up a

� Established the infrastructure & knowl

Management services.


WEALTH & ASSET MANAGEMENT

Introduced the ‘family office’ platform;

Rs 1.8 bn in the largest single day debenture listing

Received in principle approval for setting up a mutual fund;

Established the infrastructure & knowledge capital for offshore asset

services.


Page | 58

Rs 1.8 bn in the largest single day debenture listing;

mutual fund;

edge capital for offshore asset


Comparing the REVENUES


REVENUES from the year 2005-2009


Page | 59


Comparing the EBIDTA from the year 2005


Comparing the EBIDTA from the year 2005 – 2009


Page | 60


Comparing the PAT (PROFIT AFTER TAX)


PROFIT AFTER TAX) for the year ended 2005


Page | 61

the year ended 2005-2009


MARKETING DEPARTMENT

ADDRESSING ALL THE CUSTOMERS SEGMENTS


MARKETING DEPARTMENT -- INDIA INFOLINE

DIVERSIFIED



Page | 62

INDIA INFOLINE



CREATING A UNIQUE MARKET POSITION

MANAGERIAL DEPTH

� Promoted by first generation entrepreneurs

� Management team unmatched in terms of professional’s

credentials, experience as well as academic background.

TECHNOLOGY EDGE

� Widely acclaimed proprietary trading platform

� Effectively harnessed technology to fac

provide superior customer experience


DIFFERENTIATED


MANAGERIAL DEPTH

Promoted by first generation entrepreneurs

Management team unmatched in terms of professional’s


TECHNOLOGY EDGE

Widely acclaimed proprietary trading platform

Effectively harnessed technology to facilitate processes &

provide superior customer experience


Page | 63


Management team unmatched in terms of professional’s


ilitate processes &


DISTRIBUTION REACH

� Present at 1361 business locations

� Effectively cover 428 cities across India

WELL CAPITALIZED

� Net worth approximately Rs 15.4 bn (USD 306.5 mn) with

negligible debt

� Well-funded to not just weather but take advantage of

downturn

PEOPLE EDGE

� Team India Infoline is driven by pride and reward of

ownership

� To think and work like an owner is part of organization’s

DNA


DISTRIBUTION REACH

Present at 1361 business locations

Effectively cover 428 cities across India

WELL CAPITALIZED

Net worth approximately Rs 15.4 bn (USD 306.5 mn) with

negligible debt

funded to not just weather but take advantage of

Team India Infoline is driven by pride and reward of

To think and work like an owner is part of organization’s


Page | 64

Net worth approximately Rs 15.4 bn (USD 306.5 mn) with

funded to not just weather but take advantage of

Team India Infoline is driven by pride and reward of

To think and work like an owner is part of organization’s


HUMAN RESOURCE DEPARTMENT

Human resources

The nature of your company’s business requires trained and

skilled professionals. Your company has been extremely

successful in attracting & relating highly qualified

professionals, with impeccable

offering them a challengin

competitive compensation including stock ownership.

‘ownership mindset’ is the basic tenet which drives your

company’s human resource policy and all your company’s

employees behave and work like owners and this enables

them to unleash their inner entrepreneurial energy without

compromising on team work and ethics.

Financial services are a knowledge intensive sector where

employee skills form a critical aspect in service delivery. Your

company has developed comprehensive in


HUMAN RESOURCE DEPARTMENT OF IIL




professionals, with impeccable professional’s track record, by

offering them a challenging work environment, coupled with





m to unleash their inner entrepreneurial energy without

compromising on team work and ethics.



company has developed comprehensive in-house training


Page | 65




track record, by

g work environment, coupled with





m to unleash their inner entrepreneurial energy without



house training


modules to make sure that all employees understand your

company’s vision, purpose & imbibe the ethos of the

organization. Emphasis is laid ‘on the job’ trainings where an

experienced and senior person mentors the junior executives.

A human resource enterprise resource planning software is

being implemented that will enable tracking of employee level

productivity as well as create a scientific basis of performance

appraisals. The total employee strength of your company & its

subsidiaries was 8015 as on March 31. 2009.

The total employee strength of the company & its subsidiaries

stood at 14105 on March 31, 2008. This is in line with the

growth in our businesses including retail equities broking,

credit insurance, besides the building

for our institutional equities, investment banking & wealth

management verticals.






human resource enterprise resource planning software is




s was 8015 as on March 31. 2009.

total employee strength of the company & its subsidiaries



credit insurance, besides the building up of specialized teams


management verticals.


Page | 66





human resource enterprise resource planning software is




total employee strength of the company & its subsidiaries



up of specialized teams



India infoline significantly strengthened its human resources

team during the year under review by hiring the experienced

HR professionals for th

Besides, giving the scale and pace of the various businesses,

members of the HR team are now posted at zonal offices

across the country in addition to the corporate office.

With the owner mindset being the one of the tenets of the

organization, it is our continuous endeavour to unleash the

entrepreneur within each employee. Towards this end, the

culture at your company is one of responsibilities &

concomitant empowerment at all levels. This has aided us a

lot in attracting ad retaining t

identified training s one of the core focus areas under the

human resources domain. Extensive modules have been

developed in-house to educate new entrants about the culture

and skill-sets required for their jobs at India Info

continuous training program (CTP) has also been developed to

provide regular need based training inputs to the employees.




HR professionals for the senior level.





ization, it is our continuous endeavour to unleash the




lot in attracting ad retaining talent across business. We have



house to educate new entrants about the culture

sets required for their jobs at India Info




Page | 67







ization, it is our continuous endeavour to unleash the




alent across business. We have



house to educate new entrants about the culture

sets required for their jobs at India Infoline. A




RECENT AWARDS AND ACCOLADES




Page | 68



* * Research


Research report


Page | 69

* *




Page | 70


Introduction to INITIAL PUBLIC OFFERING

Meaning of IPO

IPO in India means the new offer of a company's shares to

the public in the country's capital markets. Initial Public Offer

(IPO) in India is done through various methods like method of

book building, method of fixed price or a mixture of both.

IPO (initial public o

company’s share to the public and listing of the shares on a

stock exchange. IPO is considered to be one of foremost

option with the company to invite the share capital from the

public through the public issue.

business that for a company to survive it must grow. It must

grow its market share. It must grow the customer base. In UK

IPO's are often referred as floatation’s. Many companies need

more cash than provided by an IPO. They

market in secondary offerings or right issues.


ntroduction to INITIAL PUBLIC OFFERING (IPO

means the new offer of a company's shares to




IPO (initial public offering) is, as it sounds the first sale of a




public through the public issue. It is often repeated cliché in




more cash than provided by an IPO. They return to the stock

market in secondary offerings or right issues.


Page | 71

IPO)

means the new offer of a company's shares to




ffering) is, as it sounds the first sale of a




It is often repeated cliché in




return to the stock


A SHORT NOTE ON INITIAL PUBLIC OFFER (IPO

INDIA:

Initial Public Offering (IPO) in India means the selling of the

shares of a company, for the first time, to the public in the

country's capital markets. This is done by giving to the public,

shares that are either owned by the promoters of the

company or by issuing new shares.

During an Initial Public Offer (IPO) the shares are given to the

public at a discount on the intrinsic

this is the reason that the investors buy shares during the

Initial Public Offering (IPO) in order to make profits for

themselves. A merchant banker is nominated as a book

runner by the Issuer of the IPO.

The company that is issui

decides the number of shares that it will issue and also fixes

the price band of the shares.

mentioned in the com


A SHORT NOTE ON INITIAL PUBLIC OFFER (IPO





company or by issuing new shares.


public at a discount on the intrinsic value of the shares and




runner by the Issuer of the IPO.

The company that is issuing the Initial Public Offering (IPO)


the price band of the shares. All these information are

mentioned in the company's red herring prospectus.


Page | 72

A SHORT NOTE ON INITIAL PUBLIC OFFER (IPO) IN






value of the shares and




Public Offering (IPO)


All these information are

pany's red herring prospectus.


During the company's Initial Public Offering (

electronic book is opened for at least five days. During this

period of time, bidding takes place which means that people

who are interested in buying the shares of the company make

an offer within the fixed price band.

SEBI guidelines d

undertaken by which a demand for the securities proposed

to be issued by a body corporate is elicited and built

and the price for such securities is assessed for the

determination of the quantum of such securities to be

issued by means of a notice, circular, advertisement,

document or information memoranda or offer document".

Book Building is basically a proce

(IPO) for efficient price discovery. It is a mechanism where,

during the period for which the IPO is open, bids are collected

from investors at various prices, which are above or equal to

the floor price. The offer price is

closing date.


During the company's Initial Public Offering (IPO) in India, an




an offer within the fixed price band.

SEBI guidelines defines Book Building as "a process


to be issued by a body corporate is elicited and built





Book Building is basically a process used in Initial Public Offer




the floor price. The offer price is determined after the bid


Page | 73

IPO) in India, an




efines Book Building as "a process


to be issued by a body corporate is elicited and built-up





ss used in Initial Public Offer




determined after the bid


As per SEBI guidelines, an issuer company can issue securities

to the public though prospectus in the following manner:

� 100% of the net offer to the public through book

building process

� 75% of the net offer to th

building process and 25% at the price determined

through book building. The Fixed Price portion is

conducted like a normal public issue after the

Book Built portion, during which the issue price is

determined.

The concept of Book Bui

However it is a co

Once the book building is closed then the issuer as well as the

book runner of the Initial

offers and then

that fall below the fixed price are rejected. The successful

bidders are then allotted the shares.




100% of the net offer to the public through book

building process






determined.

The concept of Book Building is relatively new in India.

However it is a co mmon practice in most developed countries


book runner of the Initial Public Offering (IPO) evaluates

offers and then determines a fixed price. The offers for shares


bidders are then allotted the shares.


Page | 74




e public through book





lding is relatively new in India.

mmon practice in most developed countries


evaluates the

price. The offers for shares



IPO MARKET IN INDIA

The IPO Market in India is on the boom as more and

more companies are issuing equity shares in the capital

market. With the introduction of the open market economy, in

the 1990s, the IPO Market went through its share of policy

changes, reforms and

important developments was the disassembling of the

Controller of Capital Issues (CCI) and the introduction of the

free pricing mechanism.

This step helped in developing the IPO Market in India,

as the companies were permi

pricing mechanism permitted the companies to raise funds

from the primary market at competitive price.


IPO MARKET IN INDIA – OVERVIEW





changes, reforms and restructurings. One of the most



free pricing mechanism.


as the companies were permitted to price the issues. The Free


from the primary market at competitive price.


Page | 75





of the most




tted to price the issues. The Free



IPO MARKET IN INDIA

The Central Government felt the need for a governed

environment pertaining

corporate houses were using the abolition of the Controller of

Capital Issues (CCI) in a negative manner.

The Securities Exchange Board of India (SEBI) was

established in the year 1992 to regulate the capital market.

SEBI was given the authority of monitoring and regulating

the activities of the bankers to an issue, portfolio managers,

stockbrokers, and other intermediaries related to the stock

markets.

The effects of the changes are evident from the trend of the

resources of the primary capital market which includes rights

issues, public issues, private placements and overseas issues.


IPO MARKET IN INDIA – REGULATIONS


environment pertaining to the Capital market, as few


Capital Issues (CCI) in a negative manner.










Page | 76


to the Capital market, as few











CREDIT RATING IPO

Earlier, an unlisted company

shares was given the option by SEBI to obtain grading for the IPO

from one or more credit rating agencies. Since May 1, 2007, it has

become mandatory for the issuer to obtain credit rating of an IPO.

The grade represents a relative ass

the issue in relation

equity shares in India.

grade to the IPO. The grading is an independent & unbiased opinion

of the agency. The purpos

take informed decisions as they do not have means to access the

IPO like other groups of investors. The grade id generally assigned

on 1 to 5 scales where higher score indicates stronger fundamental.

GRADEGRADEGRADEGRADE

1

2

3

4

5


CREDIT RATING IPO - IS IT MANDATORY

, an unlisted company making IPO of equity




The grade represents a relative assessment of the fundamentals of

relation assessment issue in relation to other listed

equity shares in India. The credit rating agencies would assign a


of the agency. The purpose of the grading is to help retail investors




IPO GRADING

GRADEGRADEGRADEGRADE FUNDAMENTALSFUNDAMENTALSFUNDAMENTALSFUNDAMENTALS

POOR

BELOW AVERAGE

AVERAGE

ABOVE AVERAGE

STRONG


Page | 77

making IPO of equity




essment of the fundamentals of

assessment issue in relation to other listed

The credit rating agencies would assign a


e of the grading is to help retail investors




FUNDAMENTALSFUNDAMENTALSFUNDAMENTALSFUNDAMENTALS

BELOW AVERAGE

ABOVE AVERAGE


IPO GRADING AGENCIES

There are four SEBI

� CRISIL

� ICRA

� CARE

� FITCH RATING INDIA

RATING RATING RATING RATING SYMBOLS AND THEIR MEANINGSYMBOLS AND THEIR MEANINGSYMBOLS AND THEIR MEANINGSYMBOLS AND THEIR MEANING

LONG TERM INSTRUMENTSLONG TERM INSTRUMENTSLONG TERM INSTRUMENTSLONG TERM INSTRUMENTS

CRISILCRISILCRISILCRISIL ICRAICRAICRAICRA

AAA LAAA

AA LAA

A LA

BBB LBBB

BB LBB

B LB

C LC

D LD


IPO GRADING AGENCIES

There are four SEBI-registered credit rating agencies in India

FITCH RATING INDIA

SYMBOLS AND THEIR MEANINGSYMBOLS AND THEIR MEANINGSYMBOLS AND THEIR MEANINGSYMBOLS AND THEIR MEANING

LONG TERM INSTRUMENTSLONG TERM INSTRUMENTSLONG TERM INSTRUMENTSLONG TERM INSTRUMENTS

ICRAICRAICRAICRA CARECARECARECARE FITCHFITCHFITCHFITCH MEANINGMEANINGMEANINGMEANING

CARE AAA AAA (Ind) HIGHEST SAFETY

CARE AA AA (Ind) HIGH SAFETY

CARE A A (Ind) ADEQUATE SAFETY

CARE BBB BBB (Ind) MODERATE SAFETY

CARE BB BB (Ind) INADEQUATE SAFETY

CARE B B (Ind) HIGH RISK

CARE C C (Ind) SUBSTANTIAL RISK

CARE D D (Ind) DEFAULT


Page | 78

registered credit rating agencies in India

MEANINGMEANINGMEANINGMEANING

HIGHEST SAFETY

HIGH SAFETY

ADEQUATE SAFETY

MODERATE SAFETY

INADEQUATE SAFETY

HIGH RISK

SUBSTANTIAL RISK

DEFAULT


MIDDLE TERM INSTRUMENTSMIDDLE TERM INSTRUMENTSMIDDLE TERM INSTRUMENTSMIDDLE TERM INSTRUMENTS


FAAA MAAA

FAA MAA

FA MA

SHORT TERM INSTRUMENTSSHORT TERM INSTRUMENTSSHORT TERM INSTRUMENTSSHORT TERM INSTRUMENTS


P-1 A1

P-2 A2

P-3 A3

P-4 A4

P-5 A5


MIDDLE TERM INSTRUMENTSMIDDLE TERM INSTRUMENTSMIDDLE TERM INSTRUMENTSMIDDLE TERM INSTRUMENTS

CARECARECARECARE FITCHFITCHFITCHFITCH MEANINGMEANINGMEANINGMEANING

CARE AAA TAAA (IND) VERY STRONG

CARE AA TAA (IND) STRONG

CARE A TA (IND) SATISFACTORY

CARE BBB MODERATE

CARE BB ADEQUATE

CARE B TB (IND) INADQUATE

CARE C TC (IND) DOUBTFUL

CARE D TD (IND) DEFAULT

SHORT TERM INSTRUMENTSSHORT TERM INSTRUMENTSSHORT TERM INSTRUMENTSSHORT TERM INSTRUMENTS

ICRAICRAICRAICRA CARECARECARECARE FITCHFITCHFITCHFITCH MEANINGMEANINGMEANINGMEANING

A1 PR1 F1 (IND) VERY STRONG

A2 PR2 F2 (IND)

A3 PR3 F3 (IND)

A4 PR4 F4 (IND)

A5 PR5 F5 (IND)


Page | 79


VERY STRONG

STRONG

SATISFACTORY

MODERATE

ADEQUATE

INADQUATE

DOUBTFUL

DEFAULT


VERY STRONG

STRONG

ADEQUATE

MINIMAL

DEFAULT


Members who are benefited in an IPO

• The vendor

• The company

• The investor

Vendor

Maximize proceeds Maximize value of remaining shares

Involving in successful deal

Keep Broad & stable ownership base

Raise company profileFacilitate future financings


ers who are benefited in an IPO

.

Initial public offering

Investor

Maximize share performance

Acquire shares in attractive co.

Vendor

proceeds

Maximize value of remaining shares

Involving in successful deal

Company

Maximize profits Keep investors happy

Broad & stable ownership base Raise company profile

Facilitate future financings


Page | 80

Investor

Maximize share performance

Acquire shares in attractive co.



The term primary offerings or primary issues and secondary

offerings or secondary issues are often used to classify the

recipient of the

investors to acquire shares from the primary & the secondary

markets. In the primary market, securities are bought by way

of public issue directly from the company. In the secondary

market, shares are traded among invest

During the 1990s, the global volume of IPO's rose from

around $11 billion in 1990 to $155 billion in 1999.

following year, 2000, saw another record, with $176 billion

raised for companies coming to the market for the first time.

The pace of flotat

global technology bubble burst, leaving bankers, lawyers,

accountants and other advisors to fight over the fees from a

‘mere’ $175 billion of offerings. When one considers that the

fees and the commission’s

from 2 to 7% of the proceeds





recipient of the proceeds. There are two mediums for




market, shares are traded among investors.


around $11 billion in 1990 to $155 billion in 1999.



The pace of flotation slackened dramatically in 2001, as the




commission’s payable on most of the IPO’s

from 2 to 7% of the proceeds one shouldn’t feel sorry


Page | 81



proceeds. There are two mediums for





around $11 billion in 1990 to $155 billion in 1999. The



ion slackened dramatically in 2001, as the




of the IPO’s range

shouldn’t feel sorry.


IPO fees are generally the highest in the USA. The

stock exchange reported in early 2001: “Wall street

investment banks earned an average fee of 6.67

proceeds for underwriting IPO's in 2000, down from 6.83 %

in1999.

x – Axis measured n terms of million $

y – Axis number of years

0 50000

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000


IPO fees are generally the highest in the USA. The


investment banks earned an average fee of 6.67

roceeds for underwriting IPO's in 2000, down from 6.83 %

Axis measured n terms of million $

Axis number of years

50000 100000 150000 200000 250000

IPO's secondary issues


Page | 82

IPO fees are generally the highest in the USA. The New York


investment banks earned an average fee of 6.67% of deal

roceeds for underwriting IPO's in 2000, down from 6.83 %

250000 300000


The Going Public process, what is it and is it Right for Your

Business?

Once a private company becomes publicly traded, it

register securities so that it can make an offer and sell them to the

investing public. This is the biggest difference in operational status

of a private vs. public company: The public company can offer its

stock to the public at large, whereas the

company is restricted to private venues, such as friends and family

members. This is a very important consideration since most

companies that go public are interested in raising capital.

Furthermore, investment bankers and broker

with a public company. A well ran private company with a healthy

bottom line, quarter after quarter, is an excellent candidate to go

public and attract outside investment capital.

Is There an Easier, Better Way to Go Public?

The easiest way for most companies to go public is to get

listed on the Pink Sheets. Going public via the Pink Sheets is an

excellent first step for smaller companies to become publicly traded

entities. Here are some further advantages:

•

•

•

•



Once a private company becomes publicly traded, it


This is the biggest difference in operational status


stock to the public at large, whereas the closely held private




Furthermore, investment bankers and broker-dealers prefer to deal



public and attract outside investment capital.

Is There an Easier, Better Way to Go Public?

way for most companies to go public is to get



entities. Here are some further advantages:

There are no reporting requirements

There is no time in business requirement

No revenue or earnings requirements

No minimum asset requirement


Page | 83


Once a private company becomes publicly traded, it will


This is the biggest difference in operational status


closely held private




rs prefer to deal



way for most companies to go public is to get



There are no reporting requirements

There is no time in business requirement

No revenue or earnings requirements


BUYING IPO – OVERVIEW

Before Buying IPO one must be sure what an IPO is. When an

existing company or a brand new company issue shares for

the public to buy in the capital market for the first time, the

process is called Initial Public Offering (IPO). With this the

shares of the company gets listed in the stock

also referred to as going public as the company approaches

the public for the funds. All companies need to raise funds for

various operations and one of the best options is raising funds

through issue of sh

earn dividends from the shares.

IMPORTANT CONSIDERATIONS IN BUYING IPO

While buying IPO, the investors must be careful about

choosing the company as there are numerous number of not

so-good companies. The inve

ears open. It is advised that the investors seek help from

professionals in this field rather than handling critical

decisions on their own.


OVERVIEW





company gets listed in the stock exchange. It




through issue of shares. The investors are interested as they

earn dividends from the shares.



choosing the company as there are numerous number of not

good companies. The investors must keep your eyes and



decisions on their own.


Page | 84





exchange. It is




ares. The investors are interested as they



choosing the company as there are numerous number of not-

stors must keep your eyes and




ISSUE PERIOD

Subscription for the public issues remains open for at least

three working days and not more than 10 working days

case of book built issues, period for which bidding is open for

three to seven working days, which is extendable by three

days in case of a revision in the period band.

IPO ALLOTMENT STATUS

After the closure of the issue, the bids received are

aggregated under different categories like firm allotment,

QIBs, NIBs, Retail, etc. The

calculated for each of the categories as against the shares

reserved for each of

Within each of these

into different buckers based on the number of shares applied

for. The oversubscription ratio is then applied to the number

of shares applied for and the num

for applications in each of the buckets is determined. This

process is followed in case of proportionate allotment.



working days and not more than 10 working days



days in case of a revision in the period band.

IPO ALLOTMENT STATUS



QIBs, NIBs, Retail, etc. The oversubscription ratios are then


reserved for each of the categories in the offer document.

Within each of these categories, the bids are then



of shares applied for and the number of shares to be allotted




Page | 85


working days and not more than 10 working days. In





ratios are then


the categories in the offer document.

the bids are then segregated



ber of shares to be allotted




In case of allotment for OIBs, earlier it was subject to the

discretion of the post

on a proportional

investments and utilizes it in building or expansion of the said

company. The shares held by such investors give them the

rights of the company and to its future profits. The process

which involves determination of the issue size and

price and best time of introduction into the market is called

"underwriting". The underwriting is generally done by the

investment bankers. These underwriting firms or investment

bankers are allotted some specified numbers of shares to sell,

which is called as

In other words, IPO Allotment Status can also be defined as

the number of stocks which an investment banker is

permitted to sell to the general investor before the share is

being traded on an exchange. The excess s

allotted to other investment bankers which are eligible to sell

such shares. In India, the main governing body that

determines such eligibility criteria and the IPO Allotment

Status is the Securities and Exchange Board of India (SEBI).



discretion of the post-issue lead manager, but now it is done

on a proportional basis. Initial Public Offering pools




which involves determination of the issue size and





hich is called as IPO Allotment Status.




being traded on an exchange. The excess shares are then






Page | 86


ow it is done

Public Offering pools




which involves determination of the issue size and type, offer








hares are then






IPO REFUND

IPO Refund is disbursed by the merchant bankers to the

applicants of Initial Public Offerings. In India, these IPO

Refunds are generally made through electronic clearing

services for pre

The clearing houses that are also involved with the process of

IPO Refund are controlled by the apex bank of India, The

Reserve Bank of India. The directives on the IPO Refund

money are issued by the Securities and Exchange Board of

India (SEBI). The direc

down as per the "Disclosure and Investor Protection

Guidelines, 2000" formulated by the Securities and Exchange

Board of India (SEBI). These IPO Refunds are also made by

direct credit and real time gross settlement (R

the laid down eligibility criteria of the applicant. For

applications, which are

dematerialized form, the relevant details of bank account of

the IPO applicant are taken from depositories.


is disbursed by the merchant bankers to the



services for pre-designated numbers of centers.





India (SEBI). The directives on the IPO Refund money are laid




direct credit and real time gross settlement (RTGS), as per


applications, which are made? Completely


the IPO applicant are taken from depositories.


Page | 87

is disbursed by the merchant bankers to the







tives on the IPO Refund money are laid




TGS), as per


Completely in the



BUYING IPO - ADVANTAGES

The Advantages of IPO

launching more and more

utilized for undertakings various projects including expansion

plans. The investors can seek the primary market for buying

IPO. At an IPO, shares can b

company issuing it. Investors may also buy shares in the

secondary market, which is the Stock Exchange, by the help

of the brokers.

Buying IPO is advantageous as the price of the shares are

cheaper, but later on the prices go u

listed in the Stock Exchange as they are listed at a premium.

Once the price goes up one can sell those shares or retain

them in case the company is growing rapidly and have acute

chances of performing very well in the future. This ca

increase the price further or help in earning fat dividends. The

IPO helps the investors to take part in the prosperity of the

company. The increase in the price of the shares after listing

is the main advantage of buying IPO in the primary market.


ADVANTAGES

Advantages of IPO are numerous. The companies are

launching more and more IPO’s to raise funds which are


The investors can seek the primary market for buying

IPO. At an IPO, shares can be bought directly from the



of the brokers.


cheaper, but later on the prices go up when the shares are




chances of performing very well in the future. This ca






Page | 88

are numerous. The companies are

to raise funds which are


The investors can seek the primary market for buying

e bought directly from the




p when the shares are




chances of performing very well in the future. This can






Major advantages of IPO

IPO has a number of advantages. IPO helps the company to create

a public awareness about the company as these public offerings

generate publicity by inducing their products to various investors

• The increase in the capital

raise funds for utilizing in various corporate operational

purposes like acquisitions, mergers,

research and development, expanding plant and

equipment and marketing

• Liquidity:

market value and can be resold. This is extremely

helpful as the company provides the employees with

stock incentive packages and the investors are provided

with the option of trading their shares for a price.

• Valuation:

value for the company and sets a standard. This works

in favor of the company as it is helpful in case the

company is looking for acquisition or merger.


of IPO



generate publicity by inducing their products to various investors

The increase in the capital: An IPO allows a company to


purposes like acquisitions, mergers, Working capital,


equipment and marketing.

Liquidity: The shares once traded have an assigned





tion: The public trading of the shares determines a





Page | 89



generate publicity by inducing their products to various investors.

allows a company to


Working capital,


The shares once traded have an assigned





The public trading of the shares determines a





• It also provides the share holders of the compan

the present value of the shares

• Increased wealth

affinity towards IPO as it can increase the wealth of the

company, without dividing the authority as in case of

partnership.

• It increases the capitalization

• It creates a market value on a company’s stock.

• The Company directors and shareholder can reta

stock and use it for

• The business will have greater access t

markets for

• In general terms, a company’s valuation and

equity ratio

possible for the company to receive much better terms

from lenders.


It also provides the share holders of the compan

the present value of the shares.

Increased wealth: The founders of the companies have an



partnership.

It increases the capitalization for the issuing company

creates a market value on a company’s stock.

Company directors and shareholder can reta

stock and use it for varied activities

he business will have greater access to the capital

markets for future capital inflow

general terms, a company’s valuation and

equity ratio will improve after going public, making it


from lenders.


Page | 90

It also provides the share holders of the company with

The founders of the companies have an



for the issuing company

creates a market value on a company’s stock.

Company directors and shareholder can retain their

o the capital

general terms, a company’s valuation and debt-to-

will improve after going public, making it



DISADVANTAGES OF IPO

It is true that IPO raises huge capital for the issuing comp

But, in order to launch an Initial Public Offering (IPO), it is

also necessary to make certain investments. Setting up an

IPO does not always lead to an improvement in the economic

performance of the company. A continuing expenditure has to

be incurred after the setting up of an IPO by the parent

company.

A lot of expenses have to be incurred in the form of legal fees,

printing costs and accounting fees, which are connected to the

registering of an IPO. Such expenses might cost hundreds of

US dollars. Apart from such enormous costs, there are other

factors as well that should be taken into consideration by the

company while introducing an IPO.

Such factors include the rules and regulations involved to set

up public offerings and this entire process o

involve a number of complexities which sometime require the

services of experts in relevant fields.


DISADVANTAGES OF IPO

It is true that IPO raises huge capital for the issuing comp





d after the setting up of an IPO by the parent




. Apart from such enormous costs, there are other


company while introducing an IPO.


up public offerings and this entire process on the other hand

nvolve a number of complexities which sometime require the

services of experts in relevant fields.


Page | 91

It is true that IPO raises huge capital for the issuing company.





d after the setting up of an IPO by the parent




. Apart from such enormous costs, there are other



n the other hand

nvolve a number of complexities which sometime require the


Some companies hire

hassle-free execution of the task. After the IPO is introduced,

the expenses become a routine in every activity involved.

Besides, the CEO of the company would have to spend a lot of

time in handling the SEC regulation

experts to do the same. All these aspects, if not handled with

efficiency, prove to be some major drawbacks related to the

launch of IPO’s. The

shareholders of the company.

Shareholders have ownershi

owners of the company or the people holding maximum

authority in the company cannot take decisions all by

themselves once an IPO has been launched and shareholders

have been formed. The shareholders have an active

participation in every decision that is being taken even if they

do not hold 50 percent share of the company. They have their

individual demands to be met as they own a certain

percentage of stakes in the company.


Some companies hire experts to do the needful to ensure a

free execution of the task. After the IPO is introduced,



time in handling the SEC regulations or sometimes he hires



IPO’s. The launch of IPO also brings about

shareholders of the company.

Shareholders have ownership in the company. The primary





n in every decision that is being taken even if they



percentage of stakes in the company.


Page | 92

experts to do the needful to ensure a

free execution of the task. After the IPO is introduced,



s or sometimes he hires



launch of IPO also brings about

p in the company. The primary





n in every decision that is being taken even if they




The SEC regulations require notifications from the

shareholders of the company, meetings, and also approvals

from them while making important business decisions.

A major risk with shareholders is that, they can sell off their

stocks any time they want, in case they see the price band of

the stakes of tha

further drop of the value of shares in the market which in turn

will decrease the overall value of the company.

The

company public include fees for legal and

accounting services

The SEC (Securities and Exchange Commission)

quarterly and yearly reporting requirements are a

burden for most companies, if trading on the

OTCBB, NASDAQ, etc







the stakes of that company is going down. This will lead to a


will decrease the overall value of the company.

typical expenses associated with taking a


accounting services

he SEC (Securities and Exchange Commission)



CBB, NASDAQ, etc


Page | 93






t company is going down. This will lead to a


typical expenses associated with taking a


he SEC (Securities and Exchange Commission)




IPO PROCESS (ISSUER’S PERSPECTIVE)

Functions

� Decision to issue shares

� Appointment of intermediary’s

� Opening of bid

� Agreement to finalize

� Draft red herring prospectus

� Appointment of intermediary’s

� Refund of money

� offer closure


IPO PROCESS (ISSUER’S PERSPECTIVE)

Functions Carried out by

Decision to issue shares

Issuer

Appointment of intermediary’s

Issuer

Issuer / investment banker

Agreement to finalize Issuer with intermediaries

Draft red herring prospectus Issuer / investment banker /

advisor

Appointment of intermediary’s Issuer

Issuer / investment banker / banker



Page | 94

Carried out by


Issuer with intermediaries

r / investment banker / legal

Issuer

investment banker / banker



IPO PROCESS (INVESTORS’ PERSPECTIVE)

Functions

� Announcement of IPO by

the company

� Draft red herring prospectus comes

Market with applications forms

� After taking the decision to purchase

submission of duly filled up forms

along with the payment

� Bank credits the account & sends

the form to the registrar for sorting &

data entry the records

� Opening of the bid and offer closure

� Allotment & refund process start


IPO PROCESS (INVESTORS’ PERSPECTIVE)

Functions Carried out by

Announcement of IPO by

through media / related people /

friends & relatives

Draft red herring prospectus comes

Market with applications forms

through the appointment merchant,

Bankers, lead managers etc.

fter taking the decision to purchase

submission of duly filled up forms

with the payment instrument

to the collecting members or to the

bank directly

Bank credits the account & sends

the form to the registrar for sorting &

Records reconciled with the bank

Opening of the bid and offer closure

check through media / related

people / friends & relatives

llotment & refund process start Ask for the share allotted or refund

in case of partially allotted


Page | 95

Carried out by

through media / related people /

through the appointment merchant,

, lead managers etc.

to the collecting members or to the

Records reconciled with the bank

check through media / related

friends & relatives

Ask for the share allotted or refund

in case of partially allotted


RECENT TRENDS

In the last quarter of FY 2007

offerings, including those from reputable business

houses, have struggled to hit their targets. India's stock

markets have been volatile, reacting to fears of a

widening global credit crunch and fears

recession. Let's have a glance of

primary market during Jan

Fund raising by Indian companies has seen a sharp drop

in the last quarter of financial year 2007

evident from an analysis of data present

table.


RECENT TRENDS

In the last quarter of FY 2007-08, several large equity




widening global credit crunch and fears

recession. Let's have a glance of IPO’s in the Indian

primary market during Jan-March, 2008.


in the last quarter of financial year 2007

evident from an analysis of data presented in the above


Page | 96

08, several large equity




of a U.S.

in the Indian


in the last quarter of financial year 2007-08. This is

ed in the above


Table 1: IPO's during Jan

Period

January 2008

February 2008

March 2008

Flash back of Some Cases

The first casualty of the Indian IPO bubble was, on February

7, 2008, Wockhardt Hospital pulled out its Rs. 676 crore IPO.

The price band of the book

280-310 to Rs. 225

extended.

But qualified institutional buyers, including foreign investors,

mutual funds and hedge funds, applied for only 0.06% of their

quota in the Wockhardt issue. The non

(Mainly for high net

0.0048 times.


Table 1: IPO's during Jan-March 2008 in India

Period IPO's

Numbers Amount (Rs. In Crores)

January 2008 9

February 2008 4

March 2008 4

Some Cases during Q4, 2007-08



The price band of the book-built issue was lowered from Rs.

310 to Rs. 225-260. The last date for subscription was

qualified institutional buyers, including foreign investors,


quota in the Wockhardt issue. The non-institutional portion

for high net-worth individuals or HNIs) was subscribed


Page | 97

IPO's

Amount (Rs. In Crores)

13,948

1,893

493



built issue was lowered from Rs.

260. The last date for subscription was

qualified institutional buyers, including foreign investors,


institutional portion

worth individuals or HNIs) was subscribed


Even the retail part saw demand for barely more than half the

pie. It was an unmitigated disaster and the first time in recent

memory that an IPO from a respected business house has

flopped in India.

Close on its heels, real estate company Emaar MGF, a joint

venture between the Dubai

Development of New Delhi, also had to withdraw its IPO in the

face of low demand. The Rs. 6,500 crore

price band of Rs. 610

630 in two trenches. The last date of subscription was

extended by three days, but to no avail.

The Bombay Stock Exchange Sensitive Index, Sensex,

touched 21,207 on January 10, an a

month later, on February 10,

month low?

Wockhardt and Emaar MGF were bad enough for investor

sentiment. But the overvalued Reliance Power IPO was the

most high profile sufferer.





flopped in India.


venture between the Dubai-based Emaar group and MGF


face of low demand. The Rs. 6,500 crore issues started with a

price band of Rs. 610-690. It was brought down to Rs. 530


extended by three days, but to no avail.


touched 21,207 on January 10, an all-time high. Barely a

month later, on February 10, had it fallen to 16,608, a five



most high profile sufferer.


Page | 98





based Emaar group and MGF


started with a

690. It was brought down to Rs. 530-



time high. Barely a

to 16,608, a five-




This was an issue f

is that the Ambani

investors. At Rs. 11,500 crore, it was India's largest

the Reliance Power IPO was eventually oversubscribed 73

times and raised $190 billion. Some $100 b

from foreign funds. This constitutes one

total foreign institutional investor (FII) money coming into the

country since 1992. "When Reliance Power lists early

February, it will be among the 10 top listed companies i

India," Anil Ambani, the younger son of Reliance founder the

late Dhirubhai Ambani, told a press conference shortly after

the IPO closed. "If we assume it lists at the issue price of Rs.

450, the market capitalization for the group will be around

$100 billion."

It was not to be. Reliance Power ended its first day on the

markets at Rs. 372, Millions lost money. The Sensex dropped

863 points in sympathy. The myth of Ambani invincibility was

shaken. Clearly, it didn't help the Reliance Power IPO that

February 2008.


This was an issue from the Ambani stable; word on the street

Ambani have always made money for their

investors. At Rs. 11,500 crore, it was India's largest

Reliance Power IPO was eventually oversubscribed 73

times and raised $190 billion. Some $100 billion of this came

from foreign funds. This constitutes one-and-a-half times the



February, it will be among the 10 top listed companies i









ry 2008.


Page | 99

rom the Ambani stable; word on the street

have always made money for their

investors. At Rs. 11,500 crore, it was India's largest-ever IPO

Reliance Power IPO was eventually oversubscribed 73

illion of this came

half times the



February, it will be among the 10 top listed companies in










A Comparison of Q1'07 & Q1'08

Table 2:

Period

Q1'07

April

May

June

Total

Q1'08

April

May

June

Total


A Comparison of Q1'07 & Q1'08

IPO’s during Q1'07 & Q1'08 in India:

IPO’s

Numbers Amount (Rs. In Crores)

4

6

10 11,914

20 13,073

1

4

8 1,572

13 1,509


Page | 100

IPO’s during Q1'07 & Q1'08 in India:

Amount (Rs. In Crores)

703

456

11,914

13,073

14

307

1,572

1,509


IPO’s witnessed a sharp decline in collections during the June

2008 quarter.

IPO’s, indicating a fall of 88.45% from the year

The data on number of

encouraging either.

In contrast to 20

floated in the June 2008 quarter. This is also the lowest

number of IPO’s

quarters in the past four


witnessed a sharp decline in collections during the June

2008 quarter. Corporate rose just over Rs 1,509 crore from

, indicating a fall of 88.45% from the year

The data on number of IPO’s that were issued are not

encouraging either.

In contrast to 20 IPO’s issues in the Q1'07, only 13


IPO’s hitting the primary market in any of the June

quarters in the past four years.


Page | 101

witnessed a sharp decline in collections during the June

just over Rs 1,509 crore from

, indicating a fall of 88.45% from the year-ago levels.

that were issued are not

issues in the Q1'07, only 13 IPO’s were


hitting the primary market in any of the June


Indian companies were also shy of raising money through the

FPO route. Not a single FPO hit the market during the June

2008 quarter compared with two FPOs during the year

quarter. Poor investor response to primary issues and steeper

valuations are majo

the market for the second time.

It is not only the number of

declined, but debt and private placement offers have also

seen a steep fall. There were only 76 companies making

private placeme

quarter. In terms of value, the collection through this route

was 44% lower at Rs 14,095.6 crore.

Even though the picture was gloomy for

private equity funds, there was a moderate growth in funds

raised through rights issues during the June 2008 quarter.

The two rights issues that were floated during the quarter

collected Rs 438 crore, reflecting a 20% rise over the year

ago levels. This is a welcome trend.




2008 quarter compared with two FPOs during the year


valuations are major reasons why companies did not approach

the market for the second time.

It is not only the number of IPO’s and FPOs that have



private placement of debt vis-à-vis 147 in the June 2007


was 44% lower at Rs 14,095.6 crore.

Even though the picture was gloomy for IPO’s


aised through rights issues during the June 2008 quarter.


collected Rs 438 crore, reflecting a 20% rise over the year

This is a welcome trend.


Page | 102



2008 quarter compared with two FPOs during the year-ago


r reasons why companies did not approach

and FPOs that have



147 in the June 2007


IPO’s, FPOs and


aised through rights issues during the June 2008 quarter.


collected Rs 438 crore, reflecting a 20% rise over the year-


ISSUE DETAILS

Issue opens : August

Issue closes : August 12, 2009

Issue size : 167.23 crore e

Fresh issue : 111.82 crore equity shares

Offer of sales by government : 55.91 crore equity shares

Of which employee reservation : 4.19 crore

Net issue : 4.19 crore equity shares

Face value : Rs 10 each

BREAK UP OF NET ISSUE TO PUBLIC :

QIBs portion : 98.12 crore equity shares

Retail portion : 16.35 crore equity shares

Non – institutional portion : 49.06 crore equity shares

Price band : Rs 30


August 7, 2009

Issue closes : August 12, 2009

Issue size : 167.23 crore equity shares

Fresh issue : 111.82 crore equity shares


Of which employee reservation : 4.19 crore equity

4.19 crore equity shares


BREAK UP OF NET ISSUE TO PUBLIC :

QIBs portion : 98.12 crore equity shares

Retail portion : 16.35 crore equity shares

institutional portion : 49.06 crore equity shares

Rs 30-36 per share


Page | 103


equity shares

institutional portion : 49.06 crore equity shares


COMPANY BACKGROUND

National hydroelectricity power corporation (NHPC) is a

hydroelectric power generating company dedicated to the

planning, develpoment & implementation of an integrated &

efficient network of hydroelectri projects in India. It carries all

the work relating to the development of hydroelectric

projects.

VALUATION

NHPC is a premier hydropower utility. The co. currently has an

installed capacity aggregating to 5,175 mw and its looking to

be a 20-gigawatt utility by 2020.it comes with

& require a a long gestation period. The operating cost of its

project is significantly lower than that of the conventional

thermal power stations.

IPO GRADING:

The issue has been graded by ICRA as IPO Grade 3, indicating

average fundament

factors in the strengths of the proposed projects arising from

their location in power


COMPANY BACKGROUND








gigawatt utility by 2020.it comes with inherited risks



thermal power stations.


average fundamentals. The IPO Grade 3 assigned by ICRA




Page | 104








inherited risks




als. The IPO Grade 3 assigned by ICRA



Adani power IPO fact sheet

ISSUE DETAILS

Issue opens : July 28. 2009

Issue closes :July 31, 2009

Issue size : 30

Fresh issue : 100 % book building process

Net issue : 13.47% of the post issue paid up capital of co.


The equity shares of the company are proposed to be listed on the

National Stock Exchange (NSE) &

The IPO of Adani Power was fairly priced.

Present Value) works out to Rs 84 per share. Add to this the

cash of Rs 12.5

fair value per share is close



Issue opens : July 28. 2009

Issue closes :July 31, 2009

301,652,031 equity shares

100 % book building process

: 13.47% of the post issue paid up capital of co.

Rs 10 each


tional Stock Exchange (NSE) & Bombay Stock Exchange (BSE).

Adani Power was fairly priced."The NPV (Net


cash of Rs 12.5-14 per share raised from the public issue, the

fair value per share is close to Rs 100 per share,"


Page | 105


: 13.47% of the post issue paid up capital of co.


Bombay Stock Exchange (BSE).

"The NPV (Net


14 per share raised from the public issue, the

to Rs 100 per share,"


The issue witnessed huge investors' interest and was

subscribed 21.64 times.

crore shares as against the issue size of 301

The company is likely to list its shares around August

2009.

IPO GRADING:





VALUATION:

Qualitatively, the co. is likely to benefit from the strong linkages of

the Adani group I the power sector, locational advantages, SEZ co

producer stats related tax and other benefits & long term power

off-take arrangements aggregating 4,744 mw. However, long

gestation period together with execution of projects on time could

be a cause of concern.



subscribed 21.64 times. It received bids for more than 538

crore shares as against the issue size of 301,652,031 shares.

The company is likely to list its shares around August




their location in power.

the co. is likely to benefit from the strong linkages of

the Adani group I the power sector, locational advantages, SEZ co


take arrangements aggregating 4,744 mw. However, long

period together with execution of projects on time could

be a cause of concern.


Page | 106


It received bids for more than 538

52,031 shares.

The company is likely to list its shares around August 20,




the co. is likely to benefit from the strong linkages of

the Adani group I the power sector, locational advantages, SEZ co-


take arrangements aggregating 4,744 mw. However, long

period together with execution of projects on time could


IPO MINI OFFERING

� Any business can go public with our Mini IPO program.

� You can sell stock directly to investors. Private companies

are very limited they can only raise mon

people who are friends and family. However, if you file a

registration statement with the SEC Securities and

Exchange Commission, and follow other guidelines, you

can even advertise your offering. Imagine being able to

advertise online or on

� This allows you go public without having to depend on an

Investment Bank. Yes, we can and will introduce you to

sources of capital including our network of

Bankers and financial groups. But this allows you to be

able to compete with the big firms when trying to

capital.


IPO MINI OFFERING

Any business can go public with our Mini IPO program.

You can sell stock directly to investors. Private companies

are very limited they can only raise money from a few





advertise online or on TV or radio.

This allows you go public without having to depend on an


sources of capital including our network of

and financial groups. But this allows you to be

able to compete with the big firms when trying to


Page | 107

Any business can go public with our Mini IPO program.

You can sell stock directly to investors. Private companies

ey from a few





This allows you go public without having to depend on an


sources of capital including our network of Investment

and financial groups. But this allows you to be

able to compete with the big firms when trying to raise


IPO SCAMS - OVERVIEW

IPO Scams are well structured game played by the absolute

opportunists consisting of intermediaries, financiers and bank

employees, who make a lot of money by controlling shares

meant for retail investors in Initial Public Offer (IPO), as the

per the statement of th

In the last few years, the capital market in India went through

a rapid transformation.

The increased use of information technology and the

integration of financial markets have stepped up the risk

profile of the cap

The two major IPO scams in the Indian Capital market were

the Harshad Mehta scam in the year 1992 and the Ketan

Parekh scam in

loopholes in the Indian capital


OVERVIEW

are well structured game played by the absolute




per the statement of the Securities Exchange Board of India.


a rapid transformation.



profile of the capital market.



Parekh scam in 2001. The IPO Scams opened up the latent

loopholes in the Indian capital market.


Page | 108

are well structured game played by the absolute




e Securities Exchange Board of India.






1. The IPO Scams opened up the latent


IPO SCAMS - CAUSES

• Two of the most common factors of the major IPO

scams in India were the tacit consent of the banks and

the poor surveillance techniques.

• The Depository Participants must be provided the proof

of identity and proof of address as a routine check for

the opening demat accounts. This was not followed.

• Numerous dematerialized accounts and bank accounts

had been opened under false names and the IPO

applications were made in non existing names.

IPO SCAMS - HOW IT WAS DONE

• At first bank accounts were opened up

"benami" names, which allowed these fictitious account

holders to open demat accounts.

• The master account holders, the person who had executed

the planning acts as an intermediary on behalf of the

financiers.

• The shares acquired at the

of listing at a premium to get more than the amount of

money invested.


CAUSES

Two of the most common factors of the major IPO


the poor surveillance techniques.

The Depository Participants must be provided the proof


ning demat accounts. This was not followed.

Numerous dematerialized accounts and bank accounts



HOW IT WAS DONE?

At first bank accounts were opened up in fictitious or


holders to open demat accounts.

The master account holders, the person who had executed


The shares acquired at the IPO’s were disposed on the date


money invested.


Page | 109

Two of the most common factors of the major IPO


The Depository Participants must be provided the proof


ning demat accounts. This was not followed.

Numerous dematerialized accounts and bank accounts



in fictitious or


The master account holders, the person who had executed


were disposed on the date



The banks played an important part by means of opening

bank accounts and giving loans to the fictitious entities for the

purpose of earning fee incomes.

IPO’s are the key stone in the financial structure of the

venture industries. But the recent paucity of IPO’s has caused

alarm for the venture industry & has intensified a continuing

shakeout among the venture capitalist firms. It

be good times ahead for early bird investors. If the current

government has its way, we might go from a complete dreath

of IPO’s & follow on issues

market with the government

both in listed and unlisted space the numbers are staggering.

Dalal Street likes noise & India could stand apart with some

very good paper hitting the market but the most important

will be what this move does for the government. The

performance of Indian

government goes ahead with reform plan.




purpose of earning fee incomes.




shakeout among the venture capitalist firms. It



IPO’s & follow on issues to a flood of new paper hitting the

market with the government being a large owner of equities





performance of Indian market depends upon a lot how the

government goes ahead with reform plan.


Page | 110






promises to



to a flood of new paper hitting the

being a large owner of equities





market depends upon a lot how the


ONE OF THE MAJOR

SEBI has agreed to dispose of pending proceedings against Mr

Gautam Zhaveri for his involvement in the IPO scam of 2003

04, following settlement of the

Mr Zhaveri, who applied for the consent order, paid Rs 2.7

crore towards settlement, including a disgorgement amount of

Rs 2.36 crore, settlement charges of Rs 23.6 lakh,

compounding charges of Rs 9 lakh and legal charges of

lakh.

The applicant (Zhaveri) had been proceeded against for

irregular dealings in shares issued through IPOs, and for

cornering shares meant for retail investors, making unlawful

profits from the shares upon their listing.


MAJOR SCAMS IS:


Gautam Zhaveri for his involvement in the IPO scam of 2003

04, following settlement of the case through a consent order.




compounding charges of Rs 9 lakh and legal charges of




profits from the shares upon their listing.


Page | 111


Gautam Zhaveri for his involvement in the IPO scam of 2003-

case through a consent order.




compounding charges of Rs 9 lakh and legal charges of Rs 1





SEBI had banned the applic

market; initiated adjudication proceedings against him,

prosecution proceedings in the ACMM court in Mumbai under

the Companies Act; and a protest petition before the CBI

court for non-filing of chargesheet against the ap

SEBI’s consent order disposes of all these pending

proceedings. SEBI will file an application for withdrawal of its

protest application at the CBI special court, and shall not

oppose compounding of prosecution in the ACMM court, the

regulator said in its consent order.

SEBI said it would also drop proceedings against Pratik Stock

Vision Pvt Ltd in the matter of carry forward transactions in

the shares of Global Tele

applicant offered to settle the case, offering Rs 1.25

towards settlement charges


SEBI had banned the applicant from dealing in the securities




filing of chargesheet against the applicant.





in its consent order.



the shares of Global Tele-systems Ltd in 2000

applicant offered to settle the case, offering Rs 1.25

towards settlement charges.


Page | 112

ant from dealing in the securities




plicant.







systems Ltd in 2000-01. The

applicant offered to settle the case, offering Rs 1.25 lakh


PUBLIC ISSUES

Year

2004

2005

2006

2007

2008

2009

0

10

20

30

40

50

60

70

80

90

100

2004 2005


PUBLIC ISSUES - CALENDAR WISE SUMMARY

No. of issues Issue amount (crore

25 13121.47

53 9989.52

73 19852.46

100 34179.11

37 16904.42

3 324.

2005 2006 2007 2008 2009

no. of issues

z


Page | 113

CALENDAR WISE SUMMARY

Issue amount (crore)

13121.47

9989.52

19852.46

34179.11

16904.42

324.4

2009


FINANCIAL YEAR WISE SUMMARY

As shown

were much more IPOs. During 2007

witnessed its highest number of IPOs in past one decade.

0

10

20

30

40

50

60

70

80

90

2004-05 2005-06

Year

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010


FINANCIAL YEAR WISE SUMMARY

As shown in the table during the economic boom there

were much more IPOs. During 2007-2008 the share market


06 2006-07 2007-08 2008-09 2009-10

no. of issues

No. of issues Issue amount (crore

23 13,749

76 10,936

76 28,504

84 42,595

21 3582

3 324.4


Page | 114

in the table during the economic boom there

2008 the share market


Issue amount (crore)

13,749

10,936

28,504

42,595

3582

324.4


CURRENT IPO REACTIONS

The diagram below depicts

been filed on the stock exchanges

signed at the time of approval. With that of filed companies in

the stock exchanges there are s

picture which

postponed, withdrawn and opened simultaneously fro

2007 to May 2009.


REACTIONS

The diagram below depicts the list of companies which has

on the stock exchanges on the date which has been


the stock exchanges there are some of the companies in the

depicts the number of companies

postponed, withdrawn and opened simultaneously fro

2007 to May 2009.


Page | 115

the list of companies which has

on the date which has been


ome of the companies in the

depicts the number of companies has been

postponed, withdrawn and opened simultaneously from July




Page | 116


Strength �

Weakness �

Opportunities �

Threats �

STRENGTH

� Dedicated employees

� Good research team

� Strong Customer

� Superior brand name

� Organization works online

� Excellent infrastructure

� Wide spread branches and brokers network


Competitive advantage of the company

� Internal constraints of the company

� Favorable conditions of the industry &

external Environments

� Adverse or potentially adverse conditions of

the industry & other external environments

Dedicated employees

Good research team

Strong Customer relationship

Superior brand name

Organization works online

Excellent infrastructure

Wide spread branches and brokers network


Page | 117

ompetitive advantage of the company

nternal constraints of the company

conditions of the industry & other

y adverse conditions of

environments


WEAKNESS

� Lacking network

� Not enough advertisement

� Lacking promotion

� Lacking for

OPPORTUNITY

� Galloping growth of Indian economy

� Rising of FDI

� Positive outlook of people towards financial products

� Growing of IPO's

� Positive outlook of people towards financial products

� Growing consumer awareness about equity related

THREATS

� Politics

� Volatile market

� Market uncertainty

� Galloping competition

� Broad economic factors like inflation etc


Lacking network

Not enough advertisement

Lacking promotion

adopting the strategies

OPPORTUNITY

growth of Indian economy

Rising of FDI

Positive outlook of people towards financial products

Growing of IPO's


Growing consumer awareness about equity related

market

Market uncertainty

Galloping competition

Broad economic factors like inflation etc


Page | 118



Growing consumer awareness about equity related product


CONCLUSION

Investment in India becomes more of a security necessity

than a business lifestyle. As the interest rates all over are

dropping, people are switching

better results. The risk band that initially existed as been

eased out and people are on the outlook for new and better

stuff. In olden days, one could invest only in few companies,

but the present day gas given people to try a

companies. The act of speculation has considerably like India

Infoline done and people have become intelligent rather than

mere speculators.

It was a very fruitful experience working in India Infoline as a

trainee. It offered exposure to the wide range of investment

options available. The risk factors involved could be

understood easily. Not only did it give a learning experience

but also an id

company by knowing their fundamentals background etc.




dropping, people are switching to other avenues which fetch




but the present day gas given people to try a wide range of


and people have become intelligent rather than

mere speculators.





but also an idea on how could we invest in any particular



Page | 119



to other avenues which fetch




wide range of


and people have become intelligent rather than





we invest in any particular



ABV...ABV...ABV...ABV...

IIL INDIA INFOLINE LIMITED

IPO INITIAL PUBLIC OFFERINGS

FIIs FOREIGN INSTITUTIONAL INVESTORS

NSE NATIONAL STOCK EXCHANGE

BSE BOMBAY STOCK EXCHANGE

NCDEX NATIONAL COMMODITIES AND DERIVATIVES EXCHANGES L

MCX MULTI COMMODITIES EXCHANGE

NSDL NATIONAL SECURITIES DEPOSITIRY LIMITED

CDSL CENTRAL DEPOSITORY SERVICES (INDIA) LIMITED

CCL CONTROLLER OF CAPITAL ISSUES

CRISIL CREDIT RATING INFORMATION SERVICES OF INDIA LIMITED

ICRA INVESTMENT INFORMATION & CREDIT RATING AGENY INDIA

CARE CREDIT ANALYSIS & RESEARCH

Q’1 QUARTER 1

Q’2 QAUTER 2

BN BILLLION

MN MILLION

PVT PRIVATE COMPANY

LTD PUBLIC LIMITED COMPANY


GLOSSORY

FULL FORMFULL FORMFULL FORMFULL FORM

INDIA INFOLINE LIMITED

INITIAL PUBLIC OFFERINGS

FOREIGN INSTITUTIONAL INVESTORS

NATIONAL STOCK EXCHANGE

BOMBAY STOCK EXCHANGE

NATIONAL COMMODITIES AND DERIVATIVES EXCHANGES L

MULTI COMMODITIES EXCHANGE

NATIONAL SECURITIES DEPOSITIRY LIMITED

CENTRAL DEPOSITORY SERVICES (INDIA) LIMITED

CONTROLLER OF CAPITAL ISSUES

RATING INFORMATION SERVICES OF INDIA LIMITED

INVESTMENT INFORMATION & CREDIT RATING AGENY INDIA

CREDIT ANALYSIS & RESEARCH

QUARTER 1

PRIVATE COMPANY

PUBLIC LIMITED COMPANY


Page | 120

NATIONAL COMMODITIES AND DERIVATIVES EXCHANGES LTD

CENTRAL DEPOSITORY SERVICES (INDIA) LIMITED

RATING INFORMATION SERVICES OF INDIA LIMITED

INVESTMENT INFORMATION & CREDIT RATING AGENY INDIA


BIBLOGRAPHY

REFERENCE

Dalal Street Investment Journal’s

Stock Market Book: First Edition

Copy right: Ramdeo Media Limited

ANNAUL GENERAL MAEETING REPORT

�

�


REFERENCE �

Dalal Street Investment Journal’s

Stock Market Book: First Edition �

Copy right: Ramdeo Media Limited

ANNAUL GENERAL MAEETING REPORT

FOR THE YEAR ENDED 2007

FOR THE YEAR ENDED 2008


Page | 121

2004

FOR THE YEAR ENDED 2007-2008

2008-2009


WEBILOGRAPHY

www.sebi.gov.in

www.ndtvprofit.com

www.ipo.com

www.monetcontrol.com

www.galatime.com

www.blonnet.com

www.bespoke.com

www.business.mapsofindia.com

www.bus

www.epwrf.res.in/upload/Current_Statistics/c10822

13.xls

www.ipohome.com

www.surakshit5.blogspot.com


WEBILOGRAPHY

www.sebi.gov.in

www.ndtvprofit.com

www.ipo.com

www.monetcontrol.com

www.galatime.com

www.blonnet.com

www.bespoke.com

www.business.mapsofindia.com

www.businessspeclator.com

www.epwrf.res.in/upload/Current_Statistics/c10822

www.ipohome.com

www.surakshit5.blogspot.com


Page | 122

www.epwrf.res.in/upload/Current_Statistics/c10822-

study on performance of initial public offer (IPO) in indian capital market

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