Retail Investors may see discounts in IPOs

Retail Investors of India may see discounts of up to 10% in IPOs by state-owned Companies by the end of year 2009.

The Government of India is planning to take its 2 state-owned companies public by this year end.

01) NHPC – National Hydroelectric Power Corporation &

02) Oil India

The book building process of these two companies is expected to begin in the August this year. According to SEBI Norms, retail investors are entitled to 35% of shares of the Total issue size in IPOs.

Retail Investors means Investors who apply for shares of less than Rs.1 Lakh of amount.

- Investors who apply for shares less than Rs.1 Lakh to get 5-10% discount.

- There might be lock-in period for retail investors.

- Retail Investors get 30-35% of issued shares depending on % of stake offloaded.

- Ensuring wider public participation will help the government clear political hurdles to divestment of PSUs.

In Short, Start Saving Money for these 2 great IPOs. By the year end, both of the above 2 companies will go public and you will get shares of it at 5-10% discounted price. So this is a great opportunity to invest in the stock market at discounted price.