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January 18, 2001
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Money > Reuters > Report January 18, 2001 |
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Old economy cos to return to Indian IPO marketIndia's old economy firms look set to stage a comeback in the initial public offering market with many lining up issues, primary market monitor Prime Database said. "The new year...may witness a revival of sorts for IPOs from the old economy," Prime's managing director Prithvi Haldea said in a company statement. New economy firms dominated the IPO market during the first nine months of this fiscal year. Out of 103 IPOs in the first nine months of 2000-01 (April-March), 92 or over 89 per cent were from new economy sectors such as information technology, communications and entertainment. That was up from 1999-2000 (April-March when nearly 71 percent of new issues were by new economy companies. Prime said IPOs from traditional manufacturing companies had taken a hit since 1995 because of problems of overcapacity, inefficient technologies, declining demand and high financial costs. But now firms from diverse old economy sectors have put together new issue plans, it said. Pizza chain Domino's, mosquito repellent maker Godrej Sara Lee, printing firm Repro and Thomson, courier firms Blazeflash and Elbee, consumer electronics company LG and department store Shoppers Stop were among the firms lining up IPOs, Prime said. Pharmaceutical firms and banks were two other sectors looking at IPOs, it said. Drug makers with issue plans included Paras Pharmaceuticals which is planning a Rs 1.5-billion IPO, Indo French Laboratories, Divi's Laboratories, Eros Pharma and Natco Pharma, Prime said. Banks planning IPOs were mainly state-run ones including Andhra Bank, Bank of Maharashtra, Allahabad Bank, Canara Bank, Central Bank of India, Punjab & Sind Bank and some subsidiaries of the State Bank of India, it added. Prime said it did not expect infrastructure firms to tap the market. According to it, new economy firms looking to access the IPO market included Reliance Infocom of the Reliance Group, New Delhi Television, Escotel Mobile Communications, Nimbus Communications, Mahindra British Telecom, Mid-Day and HCL Perot.
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