SAIL FPO Review

 

SAIL (India) FPO Review

SAIL (Steel Authority of India Limited) is likely to hit the market in January 2010 via its follow on offering. SAIL India is the largest steel maker of India and it is the public sector unit (PSU) of India having annual turnover of Rs.48,000 crores.

SAIL is India’s Top 5 highest profit earning company which was incorporated by government of India in 1973.

SAIL is India’s fastest growing PSU according to the recent survey.

Through this FPO, SAIL will raise around Rs.8000 crores from the public. Many readers of this blog have asked me that, weather they should invest in this FPO or not?

Well, I will give this FPO 5 out of 5 stars. In other words, it is a MUST investing FPO. I have two reasons for that. The first is, because it is the largest steel maker of India and the other is it’s the fastest growing PSU among all the PSUs of India.

If any private sector company wants to build plants and steel assets just like SAIL than it will have to invest literally thousands of crores which is almost next to impossible.

SAIL has its own grass-root steel plants in various states of India such as Orissa, Chhatisgarh, West Bengal, Uttar Pradesh and many more.

In my opinion, this is a must filling FPO.

Should one invest in this Company for Long term or sell on listing?

This is the question that many people ask me after the great success of Coal India. Coal India was listed at 40% premium on listing and that’s why many investors had made huge profits in it.

But well, I will advise investors to invest in this company for long time horizon may be 5 years or even 10 years. This is because the fundamentals of the company are very very strong and over the next decade, it will grow like anything and thus, ultimately the huge profits for the long term investors.