IPO: Coffee can investing strategy faces challenges with mega IPOs: 18 of 30 lag Nifty 500
Mumbai: Subscribing to large initial public offerings (IPOs) and holding them forever may not be a sure-shot way to make strong returns from these issues.
Out of the country’s 30 largest IPOs with issue sizes between ₹4,000 crore and ₹20,000 crore so far, 18 have lagged the performance of the Nifty 500 index, according to a study by Capitalmind Financial Services.
The returns on the stock were calculated based on an investor buying in the IPO and holding them. Total returns include the dividends reinvested into the stock.
According to the Capitalmind study, the largest ones have been least lucrative for investors who subscribed to the IPOs. Eight of the top 30 IPOs continue to make losses, including Reliance Power, which has fallen 84%…
