In one of the recent newsletter we mentioned that historically, when stocks trade at higher price, promoters sell stock to the public. Promoters (which include Government too) use the golden opportunity to off load their holding to the public.   “When the ducks quack, feed them” is a phrase used by the promoters and the operators to offload their share to the common public as the investors attribute their brains for the gains attained in the Bull Run and are ready to swallow the high priced stocks happily.

However, the current Bull Run is cautious with regard to the IPO as Inox Wind IPO subscribed only up to 6% as per a media report.

Inox Wind's initial public offering consists of a fresh issue of Rs 700 crore and an offer for sale of 1 crore shares by the promoter, Gujarat Fluorochemicals. The offer has opened for bidding on 18 March 2015 and will close on 20 March 2015. The price band for the issue has been fixed at Rs 315 to Rs 325. The issue offers a discount of Rs 15 on the issue price to retail individual bidders. Five lakh shares are reserved for the employees. The fresh issue of Rs 700 crore would comprise 2.22 crore shares of face value of Rs 10 each at lower price band of Rs 315 per share and 2.15 crore shares of face value of Rs 10 each at higher price band of Rs 325 per share.

Promoters and government will be keen to note the outcome of this IPO issue. Analysts inform us that if the IPO fails to attract investors then it will be a warning sign to the promoters and the bull run. The outcome will be watched closely by analysts now and the result will be known to all of us in a couple of days. If this IPO cannot be absorbed then the media would conclude that it an early warning sign to the bull run.

Coming back to the market, Nifty is expected to trade in a tight range at least till the end of the month.