Blame It On Them

The lead managers role in the markets is that of a ruffian. Its cut-throat competition and everyone is desperate for a chunk of the business. okes apart, this statement from a leading merchant banker explains the genesis of many of the problems the investor faces in the primary market. Vague companies entering with poor quality issues, fly-by-night operators, and most important, major losses for investors in primary market investments.

This poor post-listing price performance is the point of focus in this article. Look through any of the charts that give the performances of issues handled by seven top lead managers in the business today. The most important figures in the tables are under the column [Average - Offer (%)]. These figures show how much an investor would gain or lose on an average after having subscribed to an issue. As can be clearly seen, positive returns are pathetically few.

 

Who is responsible for this poor show? The issuing company, the lead managers, Sebi, or the investors? All of them, as well as several other factors, affect the price performance of any scrip. When the scrip price, the general market conditions, politics, sentiment, company performance