#393 The Risks of Chasing IPO Gains: Ajay Bagga & Vivek Kaul

20/09/2024 40 min

Listen "#393 The Risks of Chasing IPO Gains: Ajay Bagga & Vivek Kaul"

Episode Synopsis

๐—•๐—ฎ๐—ท๐—ฎ๐—ท ๐—›๐—ผ๐˜‚๐˜€๐—ถ๐—ป๐—ด ๐—™๐—ถ๐—ป๐—ฎ๐—ป๐—ฐ๐—ฒ ๐˜€๐—ฎ๐˜„ ๐—ถ๐˜๐˜€ ๐˜€๐—ต๐—ฎ๐—ฟ๐—ฒ๐˜€ ๐˜€๐˜‚๐—ฟ๐—ด๐—ฒ ๐—ฏ๐˜† ๐Ÿญ๐Ÿฏ๐Ÿฒ% ๐—ผ๐—ป ๐—ถ๐˜๐˜€ ๐—ฑ๐—ฒ๐—ฏ๐˜‚๐˜, ๐—ฐ๐—น๐—ผ๐˜€๐—ถ๐—ป๐—ด ๐—ฎ๐˜ โ‚น๐Ÿญ๐Ÿฒ๐Ÿฑ ๐—ฐ๐—ผ๐—บ๐—ฝ๐—ฎ๐—ฟ๐—ฒ๐—ฑ ๐˜๐—ผ ๐—ถ๐˜๐˜€ ๐—ถ๐˜€๐˜€๐˜‚๐—ฒ ๐—ฝ๐—ฟ๐—ถ๐—ฐ๐—ฒ ๐—ผ๐—ณ โ‚น๐Ÿณ๐Ÿฌ. ๐—ฆ๐—ถ๐—บ๐—ถ๐—น๐—ฎ๐—ฟ๐—น๐˜†, ๐—ฃ๐—ก ๐—š๐—ฎ๐—ฑ๐—ด๐—ถ๐—น ๐—๐—ฒ๐˜„๐—ฒ๐—น๐—น๐—ฒ๐—ฟ๐˜€' ๐˜€๐˜๐—ผ๐—ฐ๐—ธ ๐—ฐ๐—น๐—ถ๐—บ๐—ฏ๐—ฒ๐—ฑ ๐—ฏ๐˜† ๐Ÿฒ๐Ÿฑ%, ๐—ฒ๐—ป๐—ฑ๐—ถ๐—ป๐—ด ๐˜๐—ต๐—ฒ ๐—ฑ๐—ฎ๐˜† ๐—ฎ๐˜ โ‚น๐Ÿณ๐Ÿต๐Ÿฏ ๐—ณ๐—ฟ๐—ผ๐—บ ๐—ฎ๐—ป ๐—ถ๐˜€๐˜€๐˜‚๐—ฒ ๐—ฝ๐—ฟ๐—ถ๐—ฐ๐—ฒ ๐—ผ๐—ณ โ‚น๐Ÿฐ๐Ÿด๐Ÿฌ.

๐๐ฎ๐ญ ๐ข๐ฌ ๐ญ๐ก๐ข๐ฌ ๐ก๐ฒ๐ฉ๐ž ๐ฃ๐ฎ๐ฌ๐ญ๐ข๐Ÿ๐ข๐ž๐?

Investor FOMO (Fear of missing out) is driving demand for IPOs. As more flock to buy shares before the listing, the price tends to soar. This, in turn, can create a self-fulfilling prophecy, as investors fear losing out on potential gains and bid up the prices even further.

For retail investors punting onto equity, columnist Vivek Kaul has one piece of advice: ๐๐ข๐ฌ๐ญ๐ซ๐ข๐›๐ฎ๐ญ๐ž ๐ฒ๐จ๐ฎ๐ซ ๐ฆ๐จ๐ง๐ž๐ฒ ๐š๐œ๐ซ๐จ๐ฌ๐ฌ ๐š๐ฌ๐ฌ๐ž๐ญ ๐œ๐ฅ๐š๐ฌ๐ฌ๐ž๐ฌ
Market veteran Ajay Bagga says the market itself is not at fault, but rather the pricing of IPOs.
๐Ÿ”ด๐‘ถ๐’—๐’†๐’“๐’”๐’–๐’ƒ๐’”๐’„๐’“๐’Š๐’ƒ๐’†๐’… ๐‘ฐ๐‘ท๐‘ถ๐’” ๐’‚๐’“๐’† ๐’Ž๐’๐’“๐’† ๐’๐’Š๐’Œ๐’†๐’๐’š ๐’•๐’ ๐’๐’†๐’‚๐’… ๐’•๐’ ๐’‘๐’“๐’Š๐’„๐’† ๐’—๐’๐’๐’‚๐’•๐’Š๐’๐’Š๐’•๐’š ๐’‚๐’๐’… ๐’‘๐’๐’•๐’†๐’๐’•๐’Š๐’‚๐’ ๐’‚๐’„๐’„๐’Š๐’…๐’†๐’๐’•๐’”.
He suggests regulators should consider making it illegal to quote grey market premiums (GMPs) for IPOs. SEBI could play a role in educating investors about the risks and rewards of IPO investing

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