Coal India investors can withdraw bids up to October 25: Mint India

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Coal India investors can withdraw bids up to October 25

Investors can withdraw their bids because there has been a misstatement in Coal India’s financials

Mumbai: Those who have invested in Coal India Ltd’s Rs15,000 crore public float will get a five-day window if they wish to withdraw their applications in India’s biggest ever initial public offer (IPO). Investors can withdraw their bids because there has been a mistatement in Coal India’s financials.

Investors will be able to withdraw their bids till the end of Monday, 25 October.

S. Subramanian, head - investment banking, Enam Securities Ltd, one of the merchant bankers handling the IPO, said: “The withdrawal option has been given because of a small clerical error in the financial statements of Coal India. The statements have interchanged other income with closing stock. This has led to some difference in numbers.We have issued a corrigendum. Hence, this withdrawal option.”

Investment bankers are responsible for due diligence of the prospectus. In recent past, two other firms had to open such an window because of errors in prospectus. .

The capital market regulator has asked these firms to allow investors withdraw their applications.

Investors fear that this could push the listing cycle beyond the originally projected 12 days from closure of offer.

“There are some minor mistake in the (statements). If there are huge withdrawals, then we may have a problem. But we do not expect this,” said M.V. Ramnarayanan, LINK Intime Ltd, the share registry of Coal india.

Source: Live Mint

Coal India, IPO, NSE and overall bid details; oversubscribed 15.27x

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COAL INDIA LIMITED (NSE +BSE bids)

Total Issue Size	631636440
Total Bids Received	9646566825
Total Bids Received at Cut-off Price	394234525
No. of times issue is subscribed	15.27

As on 21-Oct-2010 21:00:00 IST 

COAL INDIA LIMITED  - NSE Bid Details Only
Updated as on 21st October 2010 at 2000 hrs
Sr.No.	Category	No.of shares offered/reserved	No. of shares bid for	No. of times of total meant for the category
1	Qualified Institutional Buyers (QIBs)	284236398	6379692800	22.45
1(a)	Foreign Institutional Investors (FIIs)		4672890850
1(b)	Domestic Financial Institutions(Banks/ Financial Institutions(FIs)/ Insurance Companies)		1459425700
1(c)	Mutual Funds		238102375
1(d)	Others		9273875
2	Non Institutional Investors	85270919	1184264625	13.89
2(a)	Corporates		798775625
2(b)	Individuals (Other than RIIs)		370671875
2(c)	Others		14817125
3	Retail Individual Investors (RIIs)	198965479	286044375	1.44
3(a)	Cut Off		223388500
3(b)	Price Bids		62655875
4	Employee Reservation	63163644	3528600	0.06
4(a)	Cut Off		3243525
4(b)	Price Bids		285075
		631636440	7853530400	12.43

FII & DII trading activity on NSE and BSE as on 21-Oct-2010

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FII trading activity on NSE and BSE on Capital Market Segment

The following is combined FII trading data across NSE and BSE collated on the basis of trades executed by FIIs on 21-Oct-2010.

FII trading activity on NSE and BSE in Capital Market Segment(In Rs. Crores) Category Date Buy Value Sell Value Net Value FII 21-Oct-2010 3580.48 2728.68 851.8

Domestic Institutional Investors trading activity on NSE and BSE on Capital Market Segment

The following is combined Domestic Institutional Investors trading data across NSE and BSE collated on the basis of trades executed by Banks, DFIs, Insurance, MFs and New Pension System on 21-Oct-2010.

DII trading activity on NSE and BSE in Capital Market Segment(In Rs. Crores) Category Date Buy Value Sell Value Net Value DII 21-Oct-2010 1539.72 1770.11 -230.39

Morgan Stanley Research: India Strategy Research India 2010: This Is Not 2007

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Key Debate: Leading indices are approaching all-time peaks and very naturally investors are drawing comparisons with 2007. The market hit its all-time high in January 2008 before it plunged. Investors are worried the market may be heading the same way in 2011. What are the similarities or, more pertinently, the differences between 2007 and 2010?


Bottom line: The market and the economy are not comparable to the exuberance of 2007 on most counts – even though the tail risks are still linked to global risk appetite and hence inflation or capital flows. Indeed, those risks panned out in 2008 – first inflation surged via higher crude oil prices and then capital flows vanished because of the financial crisis.


Our base case is that neither of these are likely to happen in 2011, given how different the world is today compared to 2007. To that extent, the market is likely to continue its upward march in 2011.



2010: This Is Not 2007

Reforms, infrastructure and real rates: The reform and infrastructure story appears much stronger in 2010. Stimulus may have played a greater role in growth in 2010, pushing demand ahead of supply andpartly contributing to higher inflation and external deficit. Real rates are in negative territory, whereas they were positive in 2007. Banking sector liquidity also appears much tighter now.

Capital flows: Even though gross capital flows appear strong in 2010, on a net basis, they do not come close to 2007 levels. Thanks to a wider current account deficit and less intervention by the Central Bank, accretion to foreign reserves in 2010 is a fraction of 2007’s. This is the case even as FDI matches 2007 levels and FII debt and equity flows remain materially higher.

Private capex cycle and funding: Corporate balance sheets look stronger in 2010, underpinned by larger cash balances and comparable debt-equity ratios. Notably, the private corporate capex cycle is at half 2007’s run rate. Corporates have preferred to fund expenditure with debt rather than equity – the complete opposite of 2007.

Return correlations: Global conditions seem to be more mixed in 2010 compared to 2007. Central banks remain accommodative – especially in the developed world, which is struggling with growth rates. Significantly, the correlation of returns between Indian and emerging market equities is almost 10 percentage points higher in 2010.

Valuation dispersion: Equity valuations were richer in 2007, both on an absolute and relative basis. The market cap to GDP was close to 150% by the end of 2007 whereas the number is around 100% currently. To us, the most striking difference is the dispersion of valuation across the market – the dispersion has been much higher in 2010, signifying selective market behavior.

Consensus behavior: Consensus earnings estimates have been largely flat in 2010 – whereas in 2007 estimates rose sharply in the second half of the year as the market made robust gains. Domestic mutual fund flows were strongly positive in 2007, whereas they have been suffering successive months of outflows (the worst ever in history) in 2010. The market was clearly more exuberant in 2007 whether measured by breadth of market performance, the extent of hedging (much lower than in 2010,) or the deviation of the narrow index from its 200 DMA.

Sector performance: One of the biggest differences is sector performance. Relative performance is the opposite for each and every sector, except for financials which outperformed in both years. The most notable differences are in utilities (which was the best performing sector in 2007 and has been the worst in 2010), technology and energy. The smallest gaps in sector performance are in financials, telecoms and materials.

The similarities between 2010 and 2007: Industrial growth and net buying by FIIs in the equity markets seem comparable. The sell side consensus appears to have the same conviction levels, though the net buy ratio started at low levels in 2010 and has risen through the year with the market. In contrast, the net buy ratio in 2007 remained unchanged through the year and at close to record highs.

Gray Market Premium Prices for India IPO: 21th Oct, 2010

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Company Name	Offer Price	Premium
	(Rs.)	(Rs.)
B S Trans	248 (Lower band)	DISCOUNT
Prestige Estates	183 (Upper Band)	DISCOUNT
Gyscoal Alloys	71 (Upper Band)	12 to 14
Coal India	225 to 245	24 to 26 +  5% discount for retail