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SRM B-SCHOOL FACULTY OF ENGINEERING AND TECHNOLOGY SRM UNIVERSITY (RAMAPURAM II) VADAPALANI, CHENNAI
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ABSTRACT This project titled A study on investors opinion towards initial public offering is analyzed by me at UNICON INVESTMENT SOLUTION Ltd, and it describes about how clients select this trading instrument. And what are the factors that determine that particular instrument with the things they (client) expect from the stock exchange. Ipos are often issued smaller, younger companies seeking the capital to expand, but can also done by large privately owned companies looking to become publicily traded. I have conducted this project report to study the perception of Indian retail Investors about their investment in IPO, this is basically a primary research; for this I have made a questionnaire and with the help of which I have collected the primary data from the retail investors. The basic objective of this research is to find out the factors affecting the investment decisions of the investors, while investing in IPOs like return, risk etc. and to check the awareness level of the Indian Retail Investors.

These objectives were accomplished through a survey of respondents at UNICON INVESTMENT SOLUTION Ltd Data was collected with the help of questionnaires. Target respondent for this survey are the one who invest in equity market frequently UNICON INVESTMENT SOLUTION Ltd. For getting authenticated results diversified group of investors i.e. short term and long term investors belonging to different age groups were selected The results obtained from the analyses were used to develop conclusion which are incorporated at the end of this file.

TABLE OF CONTENTS

Page Number

CHAPTER 1

INTRODUCTION

1.1 1.2 1.3 1.4

COMPANY BACKGROUND OBJECTIVES NEED FOR THE STUDY SCOPE & SIGNIFICANCE

CHAPTER 2

PROBLEMS & ANALYSIS

2.1 2.2 2.3 2.4

PROBLEM IDENTIFIED IMPLICATIONS OF THE PROBLEM MAJOR OBSERVATIONS SOLUTIONS

CHAPTER 3

SUGGESTIONS & CONCLUSION

3.1 3.2

SUGGESTIONS FOR IMPROVEMENT CONCLUSION

CHAPTER 1

INTRODUCTION

INITIAL PUBLIC OFFERING (IPO)

Initial public offering (IPO), also referred to simply as a "public offering", is when a company issues common stock or shares to the public for the first time. They are often issued by smaller, younger companies seeking capital to expand, but can also be done by large privatelyowned companies looking to become publicly traded. In an IPO, the issuer may obtain the assistance of an underwriting firm, which helps it determine what type of security to issue (common or preferred), best offering price and time to bring it to market. Initial Public Offering (IPO) in India means the selling of the shares of a company, for the first time, to the public in the countrys 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 value of the shares and this is the reason that the investors buy shares during the Initial Public Offering (IPO) in order to make profits for themselves. IPO in India is done through various methods like book building method, fixed price method, or a mixture of both. The method of book building has been introduced in the country in 1999 and it helps the company to find out the demand and price of its shares. A merchant banker is nominated as a book runner by the Issuer of the IPO. The company that is issuing the Initial Public Offering (IPO) decides the number of shares that it will issue and also fixes the price band of the shares. All these information are mentioned in the companys red herring prospectus. During the company's Initial Public Offering (IPO) in India, an 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 makes an offer within the fixed price band. Once the book building is closed then the issuer as well as the book runner of the Initial Public Offering (IPO) evaluate the offers and then determine a fixed price. The offers for shares that fall below the fixed price are rejected.

REASON FOR LISTING IPOs: Increase in the capital: An IPO allows a company to raise funds for utilizing in various

corporate operational purposes like acquisitions, mergers, working capital, research and development, expanding plant and equipment and marketing.

Liquidity: The shares once traded have an assigned 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: The public trading of the shares determines a 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. It also provides the share holders of the company with the present value of the shares.

OBJECTS OF THE OFFERING NEW IPO Funds Requirement Funding Plan (Means of Finance) Schedule of Implementation Funds Deployed Sources of Financing of Funds already deployed Interim Use of Funds Basic Terms of Issue Basis for issue price Tax Benefits r1.3

MERITS OF IPO:
Low cost financing No commitment of fixed returns. No restrictions attached to financing. No issues such as mortgaging, hypothecation etc. Entire money received in one stroke without linking to any milestones. No issues with returning of finance

DEMERITS
Success of IPO has an element of risk. IPO can only finance part of the project IPO performance post listing has also bearing. For new promoters and new company it is difficult to market their IPO.

1.1

COMPANY BACKGROUND

UNICON has been founded with the aim of providing world class investing experience to hitherto underserved investor community. The technology today has made it possible to reach out to the last person in the financial market and give him the same level of service which was available to only the selected few. We give personalized premium service with reasonable commissions on the NSE, BSE & Derivative market through our Equity broking arm UNICON Securities Pvt. Ltd. With our sophisticated technology you can trade through your computer and if you want human touch you can also deal through our Relationship Managers out of our more than 100 branches spread across the nation. ABOUT UNICON: UNICON is a financial services company which has emerged as a one-stop investment solutions provider. It was founded in 2004 by two visionary and hardworking entrepreneurs, Mr Gajendra Nagpal and Mr Ram M. Gupta, who possess expertise in the field of Finance. The company is headquartered in New Delhi, and has its Corporate office in Mumbai with regional offices in Kolkata, Chennai, Hyderabad and Noida

Now about unicon and its services provided.

UNICON is a professionally managed company led by a team with outstanding managerial acumen and cumulative experience of more than 400 man years in the financial markets The Company is supported by more than 4500 Uniconians and has a team of over 900 business offices in 235 cities across India. With a customer base of over 200,000 the Unicon Group has an eye for the intricate financial needs of its clients and caters to both their short term and long term financial needs of investment services.

The Equity broking arm UNICON Securities Pvt. Ltd offers personalized premium services on the NSE, BSE & Derivatives market. The Commodity broking arm Unicon Commodities Pvt. Ltd offers services in Commodity trading on NCDEX and MCX. The UNICON group also has a PCG division providing investments solutions for High Net Worth Individuals. The Corporate Advisory Services arm Unicon Capital Services (P) Ltd offers entire gamut of Investment Banking services to corporate.

MISSION: To create long term value by empowering individual investors through superior financial services supported by culture based on highest level of team work, efficiency and integrity

VISION: To provide the most useful and ethical investment solutions guided by values driven approach to growth, client service and development

GROUP OF COMPANIES UNICON financial intermediaries Pvt Ltd consists of the following group of companies:

fixed income&in vestment banking

trading in equity&de rivatives UNICON securities pvt ltd

distributio n UNICON insurance advisors pvt ltd

real estates UNICON real estates pvt ltd

commodit ies trading UNICON commodit ies pvt ltd

1.2

OBJECTIVES

OBJECTIVES OF THE STUDY

PRIMARY OBJECTIVE

To analyze the investors perception towards Initial Public Offering (IPO)

SECONDARY OBJECTIVES To study on the fundamental analysis of the company to invest in IPO issued by the Company. To analyze the investors preference in deciding the company. To study the preference of different investment categories of IPO. To analyze the benefits of the investors while investing in IPO To find out which source is more effective in creating the IPO awareness. To get the feedback of investors on their preferences towards IPO investment.

1.3

NEED FOR THE STUDY

The main purpose of the study is to analyze the IPO market. It also involves in analyzing the risk in investing the particular firm. This needs to understand the perception of the investors and the due course of market and its prominent conditions. This study will help to understand the market and its behavioral approach towards the needs of the investors. It will capture the systematic investing pattern based on the investors mode. It would be beneficial to gather as much knowledge as possible about the IPO market, the company offering it, the demand for it and any offer being planned by a competitor. The prospectus of the company can serve as a good option for finding all the details of the company. It gives out the objectives and principles of the management and will also cover the risks. This is a crucial step as the broker would be the one who would majorly handle your money. IPO allocations are controlled by underwriters. The first step to getting IPO allocations is getting a broker who underwrites a lot of deals.

The need of this study is to analyze what investors are expecting from IPO, how they make decision according to the situation, how they react for the changes that takes place in the Market. This study will helps to understand what the investor should watch out for investing in primary market.

1.4

SCOPE & SIGNIFICANCE

The study was conducted on UNICON INDIA PVT LTD Chennai. It is useful to both the investors and others to reduce risk. It is useful to analyze the thinking of people, their ideas and interest level of IPO investment. It also creates awareness among people from different classes. The company can suggest the preference of the investors in IPO, which can favor in fulfilling peoples requirements. Interaction with investor will be useful in finding out the company that has goodwill among public. This may lead us to find out the most reputed investment organization and its position in investors mind. This study gives a vivid picture about the investors perception level towards IPO. It gives a chance to buy the shares of the company directly, the reason that why they prefer IPO investment than others and what purpose they have invested in IPO. Based on this study a survey is conducted from various equity investors to analyze the IPO listing pattern. It also helps to understand the benefits of investing in IPO. The study helps the company to understand the effective ways of distribution channel for IPO.

CHAPTER 2

PROBLEM & ANALYSIS 2.1 PROBLEM IDENTIFIED

More often than not, the pricing of any IPO is what influences the decision of any investor. The rating agencies, in this case, will not talk about what price'' and ``what time'' aspects of the offer. Given that the decision to invest or avoid investments in any IPO is most often a function of the pricing, the lack of this aspect in the present IPO grading system could make the whole process an unfinished task. Also, rating agencies (experienced in debt rating) could face trouble with rating the equities, which, unlike debt rating, is more dynamic and cannot be standardized. Further, IPO grading mechanism is a globally-unique initiative; it could increase the cost of raising capital in India and urge companies to seek capital overseas. Markets, in the short term, can be price-driven and not purely motivated by company fundamentals. That is to say that, at times, even good companies at higher price could be a bad investment choice, while the not-as-good ones could be a steal at lower prices. Despite having disclaimers, a higher graded IPO may well tempt small investors into falsely believing that a high premium would come about on listing. Similarly, investors may get deluded by a low-graded IPO, which could become a `missed opportunity' in the future. The purpose of introducing grading, thus, might get defeated if it leads to a false sense of buoyancy or alarm among investors.

IMPLICATIONS OF THE PROBLEM

TABLE- 1 OCCUPATION RESPONDENT SL.NO FACTORS 1 PROFESSIO NAL 2 PVT.EMPLO YEE 3 GOVT.EMPL OYEE 4 SELF EMPLOYED TOTAL S 19 PERCENTAGE 15.8

64

53.3

18

15.1

19 120

15.8 100.0

15.8

15.8

PROFESSIONAL PVT.EMPLOYEE 15.1 GOVT.EMPLOYEE SELF EMPLOYED

53.3

INFERENCE: From the above table, it is evident that out of 120 respondents 15.8% of the respondents are professionals, 53.3% of them are private employees, and 15.1% of them are govt. employees, and remaining 15.8% of them are self employed peoples.

TABLE -2 ANNUAL INCOME

SL.NO 1

FACTORS BELOW 2 LAC

RESPONDENTS 45 46 11 6 12 120

PERCENTAGE 37.5 38.3 9.2 5.0 10.0 100.0

2 3 4 5

2-5 LAC 5-8 LAC 8-10 LAC ABOVE 10 LAC TOTAL

10 5 37.5 9.2 BELOW 2 LAC 2-5 LAC 5-8 LAC 8-10 LAC ABOVE 10 LAC

38.3

INFERENCE From the above table , it is inferred that out of 120 respondents 37.5% of the investors are having below 2 lack annual income,38.3% of them are 2-5 lack income,9.2% of them are 5-8 lack income earned, 5% of them are 8-10 lack income earned, and balance 10% of them are only earned above 10 lacks.

TABLE-3 TOTAL EXPERIENCE ABOUT INVESTMENT IN IPO

SL.NO 1 2 3 4 5

FACTORS BELOW 2 YRS 2-5 YRS 5-8 YRS 8-10 YRS ABOVE 10 YRS TOTAL

RESPONDENTS 65 29 15 6 5 120

PERCENTAGE 54.2 24.2 12.5 5.0 4.2 100.0

4.2 5 12.5 BELOW 2 YRS 2-5 YRS 5-8 YRS 54.2 24.2 8-10 YRS ABOVE 10 YRS

INFERENCE: From the above table, it is inferred that out of 120 respondents 54.2% of the investors having below 2 years experience about investment in IPO, 24.2% of them have 2-5 years experience, 12.5% of them having 5-8 years experience, 5% of them having 8-10 years experience and balance 4.2% of them having only above 10 years experience about IPO.

TABLE-4 SATISFACTION LEVEL OF IPO

SL.NO 1

FACTORS HIGHLY SATISFIED

RESPONDENTS 11 52 49

PERCENTAGE 9.2 43.3 40.8 6.7 100.0

2 3 4

SATISFIED AVERAGE

NOT SATISFIED 8 TOTAL 120

6.7

9.2

HIGHLY SATISFIED SATISFIED AVERAGE NOT SATISFIED

40.8

43.3

INFERENCE From the above table, it is evident that 9.2% of the investors highly satisfied with IPO investment, 43.3% of them are satisfied, 40.8% of them are giving average and balance 6.7% of them are not satisfied with the IPO investment.

TABLE-5 RATE OF RETURN IN INVESTING IN IPO

SL.NO 1 2 3 4

FACTORS EXCELLENT GOOD AVERAGE POOR TOTAL

RESPONDENTS 23 55 36 6 120

PERCENTAGE 19.2 45.8 30.0 5.0 100.0

5 19.2 30 EXCELLENT GOOD AVERAGE POOR

45.8

INFERENCE From the above table, it is inferred that out of 120 respondents 19.2% of the investors say that their rate of return in IPO is excellent, 45.8% are stated that it is good, 30% of the respondents stated that it is average, and remaining 5% of them are stated that it is poor.

TABLE-6 LEVEL OF KNOWLEDGE ABOUT IPOS

SL NO 1 2 3 4 5

FACTORS 0-20% 20-40% 40-60% 60-80% 80-100% TOTAL

RESPONDENTS 17 55 26 13 9 120

PERCENTAGE 14.2 45.8 21.7 10.8 7.5 100.0

7.5 10.8

14.2

0-20% 20-40% 40-60% 60-80% 21.7 80-100%

45.8

INFERENCE From the above table, it is evident that 14.2% of the investors have 0 to 20% knowledge about IPOs, 45.8% of them have 40% knowledge, 21.7% of them have 60% knowledge, 10.8% of them have 80% knowledge, and remaining 7.5% of them having only 100% Knowledge.

TABLE-7 HOW DO YOU DESCRIBE YOURSELF AS A RISK TAKER

SL NO 1 2 3

FACTORS CONSERVATIVE MODERATE AGGRESSIVE TOTAL

RESPONDENTS 22 76 22 120

PERCENTAGE 18.3 63.3 18.3 100.0

YOURSELF AS A RISK TAKER

18% 18%

CONSERVATIVE MODERATE AGGRESSIVE

64%

INFERENCE: From the above table, it is evident that out of 120 respondents 18.3% of the investors stated that their risk taking level is conservative, 63.3% of them are giving moderate, and the remaining 18.3% of them are stated that it is aggressive.

TABLE-8 IPO IS A RISKY INVESTMENT

SL.NO FACTORS 1 2 3 AGREE STRONGLY AGREE NEITHER AGREE OR DISAGREE 4 5 DISAGREE STRONGLY DISAGREE TOTAL

RESPONDENTS 34 40 32 11 3 120

PERCENTAGE 28.3 33.3 26.7 9.2 2.5 100.0

9.2

2.5 28.3 AGREE STRONGLY AGREE

26.7 NEITHER AGREE OR DISAGREE DISAGREE STRONGLY DISAGREE 33.3

INFERENCE: From the above details we can concluded that 28.3% of the investors agree that IPO is a risky investment, 33.3% of them are strongly agree, 26.7% of them have undecided (neither agree or disagree),9.2% of them disagree and 2.5% of them have strongly disagree with this statement.

TABLE-9 MODE OF INVESTMENT IN IPO

SL.NO 1 2

FACTORS ONLINE OFFLINE TOTAL

RESPONDENTS 73 47 120

PERCENTAGE 60.8 39.2 100.0

39.2

ONLINE OFFLINE

60.8

INFERENCE: From the above table it is inferred that out of 120 respondents 60.8% of them are stated that the mode of investment is through online, remaining 39.2% of them only comes through offline.

TABLE - 10

SOURCE OF COLLECTING INFORMATION REGARDING IPO

SL.NO 1 2 3 4

FACTORS BY BROKER BY MEDIA WORD OF MOUTH OTHERS TOTAL

RESPONDENTS 25 59 21 15 120

PERCENTAGE 20.8 49.2 17.5 12.5 100.0

12.5

20.8

BY BROKER BY MEDIA 17.5 WORD OF MOUTH OTHERS

49.2

INFERENCE: From the above table, it is inferred that out of 120 respondents 20.8% of the respondents stated that the source of collecting information regarding IPO is by the brokers, 49.2% of them are collected by the brokers, 17.5% of them are from word of mouth and the remaining 12.5% of them are collected through others.

TABLE-11 MODE OF CHOSING PARTICULAR IPO

SL.NO 1 2 3 4

FACTORS SELF ANALYSIS WORD OF MOUTH ANALYSTS OTHERS TOTAL

RESPONDENTS 48 50 15 7 120

PERCENTAGE 40.0 41.7 12.5 5.8 100.0

5.8

12.5

40 SELF ANALYSIS WORD OF MOUTH ANALYSTS OTHERS

41.7

INFERENCE: From the above table, it is evident that out of 120 respondents 40% of the respondents stated that the mode of choosing particular IPO is by self analysis, 41.7% of them are choosing by word of mouth, 12.5% of them are from analysts and the remaining 5.8% of them are choosing through others.

TABLE-12 WHAT PERCENTAGE OF INCOME DO YOU INVEST IN IPO

SL.NO 1 2 3 4

FACTORS 100% 75% 50% 25% TOTAL

25%

RESPONDENTS 11 14 50 45 120

PERCENTAGE 9.2 11.7 41.7 37.5 100.0

100% 50% 1 2 3 4

75%

INFERENCE: From the above table, it is evident that out of 120 respondents 9.2% of them are stated that the percentage of income invest in IPO is 100%, 11.7% of them are giving 75%, 41.7% of them are stated that 50%, and the remaining 37.5% of them are stated that it is 25%.

TABLE -13 PROFITABILITY OF IPO COMPARING WITH OTHERS

SL.NO 1 2 3 4

FACTORS AVG. RETURN HIGH RETURN LESS RETURN NO RETURN TOTAL

RESPONDENTS 42 49 24 5 120

PERCENTAGE 35.0 40.8 20.0 4.2 100.0

PROFITABILITY OF IPO
4% 20% 35% AVG. RETURN HIGH RETURN LESS RETURN NO RETURN

41%

INFERENCE: From the above table, it is evident that out of 120 respondents 35% of the investors stated that profitability of IPO comparing with others is only average return, 40.8% of them are stated that high return, 20% of them are stated that it is less return, and the remaining 4.2% of them are stated that it is no return.

TABLE-14 RISK FACTOR PREVAILING IN IPOS COMPARING WITH OTHERS

SL.NO 1 2 3 4

FACTORS HIGH RISK MEDIUM RISK LESS RISK AVG.RISK TOTAL

RESPONDENTS 22 70 17 11 120

PERCENTAGE 18.3 58.3 14.2 9.2 100.0

9.2

18.3

14.2 HIGH RISK MEDIUM RISK LESS RISK AVG.RISK

58.3

INFERENCE: From the above table, it is evident that, out of 120 respondents 18.3% of the investors are stated that the risk factor prevailing in IPO comparing with others is high risk, 58.3% of them are stated that it is medium risk, 14.2% of them are stated that it is less risk, and the remaining 9.2% of them are stated that it is average risk.

TABLE-15 INVESTING IN IPO IS SAFE FOR SMALL INVESTORS

SL.NO FACTORS 1 2 3 AGREE STRONGLY AGREE NEITHER AGREE OR DISAGREE 4 5 DISAGREE STRONGLY DISAGREE TOTAL

RESPONDENTS 38 29 43 4 6 120

PERCENTAGE 31.7 24.2 35.8 3.3 5.0 100.0

5 3.3 31.7 AGREE STRONGLY AGREE NEITHER AGREE OR DISAGREE DISAGREE STRONGLY DISAGREE

35.8

24.2

INFERENCE From the above table, it is inferred that 31.7% of the investors agree that investing in IPO is safe for small investors, 24.2% of them are strongly agree, 35.8% of them have undecided (neither agree or disagree),3.3% of them disagree and 5% of them have strongly disagree with this statement.

TABLE-16 AWARENESS OF THE PROCEDURES BEFORE APPLYING FOR THE IPO

SL.NO 1 2

FACTORS YES NO TOTAL

RESPONDENTS 66 54 120

PERCENTAGE 55.0 45.0 100.0

45

YES NO

55

INFERENCE: From the above table, it is inferred that out of 120 respondents 55% of them are giving YES for the awareness of the procedures before applying the IPO, and the remaining 45% of them stated that it is NO.

TABLE-17 DO YOU EXPECT SOME MORE COMPANIES COMING OUT WITH THEIR IPOS IN FY2011?

SL.NO 1 2 3

FACTORS YES NO CANT SAY TOTAL

RESPONDENTS 39 27 54 120

PERCENTAGE 32.5 22.5 45.0 100.0

32% 45% YES NO CANT SAY

23%

INFERENCE: From the above table, it is inferred that out of 120 respondents 32.5% of the investors are expecting some more companies coming out with their IPOs in FY2011, 22.5% of them are says that NO, and the remaining 45% of them says cant say.

TABLE-18 ADVICE FOR NEW INVESTORS IN IPOS

SL.NO 1

FACTORS GO BY ONLY PROMOTERS

RESPONDENTS PERCENTAGE 21 46 16 37 120

17.6

17.6 38.3 13.3 30.8 100.0

2 3

ONLY PREMIUM SECTORS PERFORMANCE

ALL THE ABOVE TOTAL

30.8

GO BY ONLY PROMOTERS ONLY PREMIUM SECTORS PERFORMANCE ALL THE ABOVE

13.3

38.3

INFERENCE: From the above table, it is inferred that out of 120 respondents 17.6% of the investors are stated that their advice for new investors in IPOs is go by only promoters, 38.3% of them stated that only premium, 13.3% of them are says that the sectors performance, and the remaining 30.8% of them are stated that all the above.

2.3

MAJOR OBSERVATIONS

An IPO can be a risky investment. For the individual investor, it is tough to predict what the stock or shares will do on its initial day of trading and in the near future since there is often little historical data with which to analyze the company.

Share market doesnt responded as the applicants Due to which thousands of retail investor who are not investing jumped into the market in recent years moreover they are eager not to be left out of the profit from Sensex's rapid growth

Petro Chinas share fall by 50 % following the same trend the Indian companies slated 15 IPO for 2008 will now be postponed.

2.1

SOLUTIONS

CHAPTER 3

SUGGESTIONS & CONCLUSION

3.1

SUGGESTIONS FOR IMPROVEMENT

After making the project, I would like to say SEBI is playing very important role in regulating the risk and financial aspects of the investors. Also the DIP guideline is framed in such a manner, which can be understood by any individual. Overall the process and the various intermediaries, which are involved in IPOs or initial public offering, are doing very important task. I found the following points very important from the investor point of view while doing this project:

The IPOs should be consumer friendly: Any investor should be able to analyze the IPO

in its simplest form and should be able to understand of whether to apply for it or not.

IPOs should be graded which is already started. But I think such kind of grading is not

enough because it doesnt give enough information about the company; it only says what the level of grade that a company deserves is. I would suggest shortening the time between application and allocation or listing. We

know SEBI and other intermediaries has done great job in doing so in the past, but looking at the current scenario we think its very important to do so. This would help investor in investing the same money in other IPOs if he is not allotted shares in that particular company.

3.2

CONCLUSION

The Indian initial public offer (IPO) market has always had more than its fair share of doomsayers Right from the Maruti issue, which pundits decried as being overpriced, to the ONGC and TCS issues, where the huge sizes of the offerings drew predictions of calamitous effects on the secondary markets, the opinions of the experts have proved to be wide off the mark. Not only did the mega issues sail through, but the secondary markets proved to be far more resilient than anybody had anticipated. The data show that as much as Rs. 2033.99 Crores has been raised from the primary market in the current calendar year, making it obvious that the Indian investor has far more appetite for equities than most people realize. Most of the money has been raised by big companies with a long-term track record. A substantial number of issuesbarring that of TCSalso happened during the early part of the year, before the markets got the shivers. The heavy oversubscriptions in many cases can also be traced to the availability of bank finance for IPO investment. Nevertheless, there is no denying the enormous interest retail and other investors have shown in the primary market, perhaps even more so than in the secondary one. This interest has been sustained despite the lack of bounce in the secondary market and is not confined to the big issues; even smaller issues have sailed through with large oversubscriptions. If investors are gung-ho about IPOs, there are several reasons for it. Unlike earlier IPO booms, this one is being driven by a much better quality of offering. Missing in action so far are the fly-by-night operators of the 1990s who made public offers only to collect the money and vanish. Next, most recent IPOs have resulted in gains on listing for the investor. The listing gains have probably initiated a kind of virtuous cycle, tempting investors who have already made money to return to the primary market. There is also reason to believe that companies are pricing their issues less aggressively this time, either due to general concerns about a volatile market, or because of a deliberate effort to leave something on the table for all investors. DQ Entertainment (International) Ltd and NMDC Limited are lining up issues. Even mutual funds have got into the act, and are tailoring their offerings to match current market fancies mid-cap funds, dividend yield funds, and whathave you. If the government wants to get some money into its kitty through disinvestment programmers, this is the time to make a dash for it

APPENDICES
QUESTIONNAIRE BIBLIOGRAPHY

QUESTIONNAIRE 1) Name: 2) Age: (1) Below 25 (2) 25-35 (3) 36-45 (4) 46-55 (5) above 55 3) Gender (1) Male (2) Female

4) Occupation: (1) Professional (2) Pvt. Employee (3) Govt. employee (4) Self employed 5) Annual income per annum (1)Below 2 Lac (2) 2-5 Lac (3)5-8 Lac (4)8-10 Lac (5) above 10 Lac 6) Total experience about investment in IPO? (1) Below 2 yrs (2) 2-5 yrs (3) 5-8 yrs (4) 8-10 yrs (5) above 10 yrs 7) What is your satisfaction level in IPOS? (1) Highly satisfied (2) Satisfied (3) Average (4) Not Satisfied 8) To what extent rate of return in investing in IPO is viewed from your point of view? (1) Excellent (2) good (3) average (4) poor 9) To what level do you have knowledge about IPOS? (1) 0-20% (2) 20-40% (3) 40-60% (4) 60-80% (5) 80-100% 10) How do you describe yourself as a risk taker? (1) Conservative (2) Moderate (3) Aggressive 11) IPO is a risky investment.. (1)Agree (2) strongly agree (3) Neither agree or Disagree (4) Disagree (5) Strongly Disagree 12) Mode of investment in IPO? (1) Online (2) Offline 13) Which source do you prefer to collect information regarding particular IPO? (1)By the broker (2) by media (3) Word of mouth (4) others 14) What mode you to chose particular IPO? (1)By self analysis (2) word of mouth (3) analysts (4) others 15) What percentage of income do you invest in IPO? (1)100 % (2)75% (3)50% (4) 25% 16) How you find the profitability of IPO comparing with other investment?

(1)Average Return (2) High return (3) Less return (4) No return 17) How you analyze the risk factor prevailing in IPOs comparing with other investment? (1) High risk (2) Medium risk (3) Less risk (4) Average risk 18) Investing in IPO of companies is safe for small investors (1)Agree (2) strongly agree (3) Neither agree or Disagree (4) Disagree (5) Strongly Disagree 19) List your preference of investing in a company (1) Brand/image of the company (2) Profitability of the company (3) Dividend policy (4) Company performance (5) others. 20) Do you know the importance of fundamental analysis of an IPO? (1) Yes (2) No 21) Are you aware of the procedures before applying for the IPOs? (1) Yes (2) No 22) Do you expect some more companies coming out with their IPOs in FY 2011? (1) Yes (2) No (3) Cant say 23) What is your advice for new investors in IPOs? (1) Go by only promoters (2) Go by only premium (3) Go by only sectors performance (4) All the above 24) Have you suggested your friends, relatives, and colleagues to invest in IPO? (1) If yes mention the reason (2) If no mention the reason