50 Punjab and Sind Bank Shares

... is all I got of the 300 I applied for. In fact all of the 8 people I have spoken to have been allocated 50 shares irrespective of what they applied for. Actually no, one of them got nothing.

50 shares is nothing write home about. I got them at 114 and they closed at 128.35 on the 31st December. I think the Indian investor has unreasonable expectations when it comes to IPOs; we tend to demand that we get returns in the range of 25-40% at the very least. And that too on the day the stock lists.

As I mentioned in an earlier post about the PSB IPO, I too went in with the idea that I would get huge returns on listing, sell of immediately and encash my profit.

How much was my profit by the way? Turns out not too bad...

1. In 2 days of being listed, the stock closed 14.35 rupees higher. On 114, that means a return of around 12.5%. Not bad at all for 2 days.
2. If I consider an overall 'investment' of 36,000 rupees (for 300 shares @ 120 put in on the 14th December), I am looking at Rs 717.5 in half a month. A return of around 2%. Which translates to 48% per annum.

What am I saying? I am saying that even with the 'low' rise of the IPO stock, there still is a decent percentage to be made. However, with just 50 shares, the decent percentages do not really add up to significant money.

Was it worth it? Absolutely not.

Punjab and Sind Bank IPO

Did you not apply for the Coal India IPO? Did you miss out on the big money people made on it? Have you applied for the PSB IPO?

I did not apply for Coal India, but I did apply for the PSB IPO. I am not a big fan of PSUs, or any company that is basically state owned, so I was never keen on either. Looking at the the prospectus for PSB, there is a huge list of risks, including a few civil cases and IT cases.

As it is, there is nothing in this IPO that would attract one to buy it for the long term, but the fact is there appears to be some money to be made on almost any IPO listing, especially a nationalised bank. So I have applied for some shares, which I intend to sell off at the first reasonable opportunity. The fact that this IPO is oversubscribed almost 50 times, I am not too optimistic I will get too many shares, but it's worth a shot!