Over half of IPOs on BSE, NSE trading below offer price: Govt

NEW DELHI: More than half of the total number of IPOs listed on BSE and NSE in the last two years are trading below their offer price, with around one-third of them trading at a discount of 40-60 per cent, Parliament was informed on Tuesday.

During April 1, 2006-March 31, 2008, the number of IPOs listed on the Bombay Stock Exchange stood at 150, of which 86 are trading below their offer price, Minister of State for Finance Pawan Kumar Bansal said in a written reply to the Rajya Sabha.

And of these, 36 IPOs were trading at discount of more than 40-60 per cent of the issue price, he said.

While, on the National Stock Exchange, of the 162 IPOs listed during the same period, 88 were trading below the issue price and 38 were being traded at a discount of more than 40 per cent of the issue price, he said.

To an another query, Bansal said, "The authorities do not try to manage or control prices. They endeavour to build systems...and broaden markets which can stand volatility."

He further said that under the current practice, the price of IPOs, is discovered by the market through book building mechanism, while the authorities make efforts to provide all the relevant information to market participants