I don't know why but somehow the Facebook IPO brings back memories of the Reliance Power IPO.
At the upper range of the $28 - $35 a share band, Facebook will be valued at $96 billion.Through this IPO, CEO Mark Zuckerberg plans to raise $11.8 billion, biggest ever amount by an Internet Company.
The Reliance Power IPO had opened in January of 2008. Touted to be India's largest IPO, it drew bids of $27.5 billion on the first day itself. The stock listed on February 11, 2008 amid sudden concerns that the IPO was overpriced. As we all know, the IPO turned out to be a disaster and it marked the end of the massive bull run in the stock markets. It also marked the beginning of the recession in 2008.
The big question is, will the Facebook IPO have the same effect on the US markets or probably world markets? Analysts have already started complaining about Facebook's IPO being overpriced. Further, Facebook's results showed signs of slowing down last quarter. Like during the days of the Reliance Power IPO, analysts are advising people to make a quick buck by dumping shares after the listing - to make most of the hype and momentum in the markets. Mark Zuckerberg, however, is betting on mobile device advertising to contribute to Facebook's income and seems to have some tricks up his sleeve.
I want to hear from you guys on what you think about Facebook's IPO and if all the hype will last. Will it mark a long drawn downtrend for Internet companies like the Reliance Power IPO did for Indian Power companies?
Only time will tell.
Coming back home, India's industrial output shrank 3.5% in March compared to a year earlier. This is not all that surprising considering ground realities. Indian manufacturing companies, especially the small and medium ones have borne the brunt of RBI's high interest rates. Growth is based on momentum ... you need to keep it going. Once stopped, it will be very tough to start it up and bring it back on track again.
Let us take a look at the markets. The last time we spoke, the markets were consolidating and were on the verge of a big move. The big move has come in the form of a break down. Here is the chart:
Till next time ... Happy investing!
At the upper range of the $28 - $35 a share band, Facebook will be valued at $96 billion.Through this IPO, CEO Mark Zuckerberg plans to raise $11.8 billion, biggest ever amount by an Internet Company.
The Reliance Power IPO had opened in January of 2008. Touted to be India's largest IPO, it drew bids of $27.5 billion on the first day itself. The stock listed on February 11, 2008 amid sudden concerns that the IPO was overpriced. As we all know, the IPO turned out to be a disaster and it marked the end of the massive bull run in the stock markets. It also marked the beginning of the recession in 2008.
The big question is, will the Facebook IPO have the same effect on the US markets or probably world markets? Analysts have already started complaining about Facebook's IPO being overpriced. Further, Facebook's results showed signs of slowing down last quarter. Like during the days of the Reliance Power IPO, analysts are advising people to make a quick buck by dumping shares after the listing - to make most of the hype and momentum in the markets. Mark Zuckerberg, however, is betting on mobile device advertising to contribute to Facebook's income and seems to have some tricks up his sleeve.
I want to hear from you guys on what you think about Facebook's IPO and if all the hype will last. Will it mark a long drawn downtrend for Internet companies like the Reliance Power IPO did for Indian Power companies?
Only time will tell.
Coming back home, India's industrial output shrank 3.5% in March compared to a year earlier. This is not all that surprising considering ground realities. Indian manufacturing companies, especially the small and medium ones have borne the brunt of RBI's high interest rates. Growth is based on momentum ... you need to keep it going. Once stopped, it will be very tough to start it up and bring it back on track again.
Let us take a look at the markets. The last time we spoke, the markets were consolidating and were on the verge of a big move. The big move has come in the form of a break down. Here is the chart:
Till next time ... Happy investing!
