Project Report On Reliance Power Ipo

SUMMER INTERNSHIP PROGRAMME-2009

FINAL REPORT ON "INITIAL PUBLIC OFFERINGS WITH SPECIAL REFERENCE TO RELIANCE POWER"

SUBMITTED TO:MR. Rajesh Yadav MRS Simreena Singh

SUBMITTED BY:-

ACKNOWLEDGEMENT “No man is indispensable but there are certain mortal without whom the quality work suffers their guidance becomes important in acquiring quality results”. I am immense grateful to my subject teachers MRS. SIMREENA SINGH & RAJESH YADAV who has given me this opportunity to prepare this project and provided their invaluable guidance. I am also grateful to my company guide MR.AYAN CHATTERJI who has provided all the necessary information required to prepare this report. I am also grateful to my parents and friends who inspired me to put my best efforts.

DECLARATION I here by declare that this project report titled submitted by me in partial fulfillment for the award of “MASTER OF BUSINESS ADMINISTRATON” is a result of the authentic work taken by me. I have not submitted the same to any other university for any other graduate or post graduate course whatsoever.

TABLE OF CONTENTS Sr.No

Contents

Page

1.

Company profile

5

2.

Corporate Governance 7

3.

8

4.

About Dhiru bhai Ambani Chairman’s Profile

5.

Introduction

10

6.

Objectives of study

21

7.

Research Methodology 22

8.

Data Interpretation

9.

Observation & Findings

10.

Conclusion

11.

Suggestions

12.

Bibliography

13.

Annexure

9

23 28 30 31 32 33

COMPANY PROFILE

Reliance Power Limited is under the Anil Ambani Group and it is involved in the business of developing large and medium size power projects. Reliance Power Limited has plans developing around thirteen large and medium sized power projects. The projects that are being developed by Reliance Power Limited are located in southern India, western India, north- eastern India and northern India. The total installed power generation capacity of all the thirteen power projects would be around 28,200 MW. Reliance Power Limited (Reliance Power), part of RADAG has been set up to develop, construct and operate power projects domestically and internationally. It aims to develop 13 power projects with an aggregated generation capacity of 28,200 MW. Reliance Power will have a diversified project portfolio in terms of geography, fuel mix and technology. Nine of the proposed thirteen projects are coal-fired or gas-based and two of those have fuel security; the rest are yet to be finalized. In our view, for such huge capacity, fuel linkage is of paramount importance

Long term PPAs for 8,560MW have been signed, constituting just 32% of the aggregated generating capacity. Of these, Sasan project (based on domestically procured coal) and Krishnapatnam project (based on imported coal) have been signed at a tariff of Rs1.19kw/h and 2.33kw/h per unit respectively, the differential attributable to the high cost of imported coal. A large number of PPAs are yet to be signed, reflecting some ambiguity on profitability. We believe equipment sourcing will be critical for Reliance Power being able to commission projects on schedule. Other key factors, apart from capital costs, are timely deliveries of equipment and maintenance costs. We believe the Group can draw synergies from the expertise of Reliance Energy . in EPC in executing projects of Reliance Power. Our concerns include lack of fuel linkages except for 2 projects, coal prices and gas and equipment availability. Also in view of the gap between the aggregate project outlay of Rs1, 12,129Cr and post-IPO net worth of 13,707Cr, we believe Reliance Power may have to opt for further equity dilution going forward, in order to maintain a manageable debt-equity ratio going forward. While the high promoter holding of around 90% post-listing is a positive, it may be viewed negatively from the point of view of minority shareholders, since the latter will enter the company @ Rs450 per share vis-à-vis promoters’ average cost of Rs16.92 per share. Given the long gestation period of projects, which are likely to get commissioned from FY10 onwards, we have considered non-earnings related valuation parameters. The valuation of the IPO in terms of price/book (7.4x FY08E) appears expensive vis-à-vis NTPC (2.8x) and Tata Power (4.5x). The issue appears expensive, also on the basis of asset valuation (estimated valuation of generating capacity) in FY13. It is only on the basis of FY17 estimates, that the issue looks attractive. However, we believe the aggression and track record of the promoter group in shareholder wealth creation in all its businesses including telecommunications, power distribution, financial services and entertainment is likely to have a positive rub-off effect on this IPO as well.

Corporate Governance

Organizations, like individuals, depend for their survival, sustenance and growth on the support and goodwill of the communities of which they are an integral part, and must pay back this generosity in every way they can... This ethical standpoint, derived from the vision of our founder, lies at the heart of the CSR philosophy of the Reliance – ADA Group. While we strongly believe that our primary obligation or duty as corporate entities is to our shareholders – we are just as mindful of the fact that this imperative does not exist in isolation; it is part of a much larger compact which we have with our entire body of stakeholders: From employees, customers and vendors to business partners, ecosystem, local communities, and society at large. We evaluate and assess each critical business decision or choice from the point of view of diverse stakeholder interest, driven by the need to minimize risk and to pro-actively address long-term social, economic and environmental costs and concerns. For us, being socially responsible is not an occasional act of charity or that one-time token financial contribution to the local school, hospital or environmental NGO. It is an ongoing year-round commitment, which is integrated into the very core of our business objectives and strategy. Because we believe that there is no contradiction between doing well and doing right. Indeed, doing right is a necessary condition for doing well.

ABOUT LATE SH. DHIRUBHAI AMBANI Few men in history have made as dramatic a contribution to their country’s economic fortunes as did the founder of Reliance, Sh. Dhirubhai H Ambani. Fewer still have left behind a legacy that is more enduring and timeless. As with all great pioneers, there is more than one unique way of describing the true genius of Dhirubhai: The corporate visionary, the unmatched strategist, the proud patriot, the leader of men, the architect of India’s capital markets, the champion of shareholder interest. But the role Dhirubhai cherished most was perhaps that of India’s greatest wealth creator. In one lifetime, he built, starting from the proverbial scratch, India’s largest private sector enterprise. When Dhirubhai embarked on his first business venture, he had a seed capital of barely US$ 300 (around Rs 14,000). Over the next three and a half decades, he converted this fledgling enterprise into a Rs 60,000 crore colossus—an achievement which earned Reliance a place on the global Fortune 500 list, the first ever Indian private company to do so. Dhirubhai is widely regarded as the father of India’s capital markets. In 1977, when Reliance Textile Industries Limited first went public, the Indian stock market was a place patronized by a small club of elite investors which dabbled in a handful of stocks. Undaunted, Dhirubhai managed to convince a large number of firsttime retail investors to participate in the unfolding Reliance story and put their hard-earned money in the Reliance Textile IPO, promising them, in exchange for their trust, substantial return on their investments. It was to be the start of one of great stories of mutual respect and reciprocal gain in the Indian markets. Under Dhirubhai’s extraordinary vision and leadership, Reliance scripted one of the greatest growth stories in corporate history anywhere in the world, and went on to become India’s largest private sector enterprise. Through out this amazing journey, Dhirubhai always kept the interests of the ordinary shareholder uppermost in mind, in the process making millionaires out of many of the initial investors in the Reliance stock, and creating one of the world’s largest shareholder families.

CHAIRMAN'S PROFILE

Anil D. Ambani

Regarded as one of the foremost corporate leaders of contemporary India, Shri Anil D Ambani, 48, is the chairman of all listed companies of the Reliance ADA Group, namely, Reliance Communications, Reliance Capital, Reliance Energy and Reliance Natural Resources limited. He is also Chairman of the Board of Governors of Dhirubhai Ambani Institute of Information and Communication Technology, Gandhi Nagar, Gujarat. Till recently, he also held the post of Vice Chairman and Managing Director of Reliance Industries Limited (RIL), India’s largest private sector enterprise. Anil D Ambani joined Reliance in 1983 as Co-Chief Executive Officer, and was centrally involved in every aspect of the company’s management over the next 22 years. He is credited with having pioneered a number of path-breaking financial innovations in the Indian capital markets. He spearheaded the country’s first forays into the overseas capital markets with international public offerings of global depositary receipts, convertibles and bonds. Starting in 1991, he directed Reliance Industries in its efforts to raise over US$ 2 billion. He also steered the 100-year Yankee bond issue for the company in January 1997.

INTRODUCTION Initial public offering Initial public offering (IPO), also referred to simply as a "public offering" or "flotation," is when a company issues common stock or shares to the public for the first time. They are often issued by smaller, younger companies seeking capital to expand, but can also be done by large privately-owned companies looking to become publicly traded. In an IPO the issuer may obtain the assistance of an underwriting firm, which helps it determine what type of security to issue (common or preferred), best offering price and time to bring it to market. An IPO can be a risky investment. For the individual investor, it is tough to predict what the stock or shares will do on its initial day of trading and in the near future since there is often little historical data with which to analyze the company. Also, most IPOs are of companies going through a transitory growth period, and they are therefore subject to additional uncertainty regarding their future value. However, in order to make money, calculated risks need to be taken.

Reasons for listing When a company lists its shares on a public exchange, it will almost invariably look to issue additional new shares in order to raise extra capital at the same time. The money paid by investors for the newly-issued shares goes directly to the company (in contrast to a later trade of shares on the exchange, where the money passes between investors). An IPO, therefore, allows a company to tap a wide pool of stock market investors to provide it with large volumes of capital for future growth. The company is never required to repay the capital, but instead the new shareholders have a right to future profits distributed by the company and the right to a capital distribution in case of dissolution. The existing shareholders will see their shareholdings diluted as a proportion of the company's shares. However, they hope that the capital investment will make their shareholdings more valuable in absolute terms. In addition, once a company is listed, it will be able to issue further shares via a rights issue, thereby again providing itself with capital for expansion without incurring any debt. This regular ability to raise large amounts of capital from the

general market, rather than having to seek and negotiate with individual investors, is a key incentive for many companies seeking to list.

Procedure IPOs generally involve one or more investment banks as "underwriters." The company offering its shares, called the "issuer," enters a contract with a lead underwriter to sell its shares to the public. The underwriter then approaches investors with offers to sell these shares. The sale (that is, the allocation and pricing) of shares in an IPO may take several forms. Common methods include: • • • • • •

Best efforts contract Firm commitment contract All-or-none contract Bought deal Dutch auction Self distribution of stock

In the business of initial public offering, the underwriting contract is the contract between the underwriter and the issuer of the common stock. The following types of underwriting contracts are most common In the firm commitment contract the underwriter guarantees the sale of the issued stock at the agreed-upon price. For the issuer, it is the safest but the most expensive type of the contracts, since the underwriter takes the risk of sale In the best efforts contract the underwriter agrees to sell as many shares as possible at the agreed-upon price. Under the all-or-none contract the underwriter agrees either to sell the entire offering or to cancel the deal. Stand-by underwriting, also known as strict underwriting or old-fashioned underwriting is a form of stock insurance: the issuer contracts the underwriter for the latter to purchase the shares the issuer failed to sell under stockholders subscription and applications A large IPO is usually underwritten by a "syndicate" of investment banks led by one or more major investment banks (lead underwriter). Upon selling the shares, the underwriters keep a commission based on a percentage of the value of the shares sold. Usually, the lead underwriters, i.e. the underwriters selling the

largest proportions of the IPO, take the highest commissions—up to 8% in some cases. Multinational IPOs may have as many as three syndicates to deal with differing legal requirements in both the issuer's domestic market and other regions. For example, an issuer based in the E.U. may be represented by the main selling syndicate in its domestic market, Europe, in addition to separate syndicates or selling groups for US/Canada and for Asia. Usually, the lead underwriter in the main selling group is also the lead bank in the other selling groups. Because of the wide array of legal requirements, IPO’s typically involve one or more law firms with major practices in securities law, such as the Magic Circle firms of London and the white shoe firms of New York City Usually, the offering will include the issuance of new shares, intended to raise new capital, as well the secondary sale of existing shares. However, certain regulatory restrictions and restrictions imposed by the lead underwriter are often placed on the sale of existing shares. Public offerings are primarily sold to institutional investors, but some shares are also allocated to the underwriters' retail investors. A broker selling shares of a public offering to his clients is paid through a sales credit instead of a commission. The client pays no commission to purchase the shares of a public offering; the purchase price simply includes the built-in sales credit. The issuer usually allows the underwriters an option to increase the size of the offering by up to 15% under certain circumstance known as the green shoe or over allotment option. The first sale of stock by a private company to the public. IPO’s are often issued by smaller, younger companies seeking the capital to expand, but can also be done by large privately owned companies looking to become publicly traded.

In an IPO, the issuer obtains the assistance of an underwriting firm, which helps it determine what type of security to issue (common or preferred), the best offering price and the time to bring it to market

Pricing Historically, IPOs both globally and in the United States have been under priced. The effect of "initial under pricing" an IPO is to generate additional interest in the stock when it first becomes publicly traded. Through flipping, this can lead to significant gains for investors who have been allocated shares of the IPO at the

offering price. However, under pricing an IPO results in "money left on the table"—lost capital that could have been raised for the company had the stock been offered at a higher price. One great example of all these factors at play was seen with theglobe.com IPO which helped fuel the IPO mania of the late 90's internet era. Underwritten by Bear Stearns on November 13, 1998 the stock had been priced at $9 per share, and famously jumped 1000% at the opening of trading all the way up to $97, before deflating and closing at $63 after large sell offs from institutions flipping the stock . Although the company did rise about $30 million from the offering it is estimated that with the level of demand for the

offering and the volume of trading that took place the company might have left upwards of $200 million on the table. The danger of overpricing is also an important consideration. If a stock is offered to the public at a higher price than the market will pay, the underwriters may have trouble meeting their commitments to sell shares. Even if they sell all of the issued shares, if the stock falls in value on the first day of trading, it may lose its marketability and hence even more of its value. Investment banks, therefore, take many factors into consideration when pricing an IPO, and attempt to reach an offering price that is low enough to stimulate interest in the stock, but high enough to raise an adequate amount of capital for the company. The process of determining an optimal price usually involves the underwriters ("syndicate") arranging share purchase commitments from leading institutional investors.

Issue price A company that is planning an IPO appoints lead managers to help it decide on an appropriate price at which the shares should be issued. There are two ways in which the price of an IPO can be determined: either the company, with the help of its lead managers, fixes a price or the price is arrived at through the process of book building. Note: Not all IPOs are eligible for delivery settlement through the DTC system, which would then either require the physical delivery of the stock certificates to the clearing agent bank's custodian, or a delivery versus payment (DVP) arrangement with the selling group brokerage firm. This information is not sufficient.

Introduction of IPO in context of Indian market The Indian primary market has come a long way particularly in the last decade after deregulation of the Indian economy in 1991-92. Both the primary and secondary markets have had their fair share of reforms, structural cum policy changes time to time. The most commendable being the dismantling of the Controller of Capital Issues (CCI) and introduction of the free pricing mechanism. This changed the whole facet of Initial Public

Recent Trends In the last quarter of FY 2007-08, several large equity offerings, including those from reputable business houses, have struggled to hit their targets. India's stock markets have been volatile, reacting to fears of a widening global credit crunch and fears of a U.S. recession. Let's have a glance of IPOs in the Indian primary market during Jan-March, 2008. Table 1: IPOs during Jan-March 2008 in India Period January 2008 February 2008 March 2008

IPOs Numbers 9 4 4

Amount (Rs. In Crores) 13,948 1,893 493

Fund raising by Indian companies has seen a sharp drop in the last quarter of financial year 2007-08. This is evident from an analysis of data presented in the above table.

Largest IPOs of the world • • • • •

Industrial & Commercial Bank of China $21.6B in 2006 NTT Mobile Communications $18.4B in 1998 Visa Inc $17.9B in 2008 AT&T Wireless $10.6B in 2000 Rosneft $10.4B in 2006

Reliance Power IPO Reliance Power Ltd has announced that the Board of Directors of the Company at its meeting held on February 24, 2008, has approved a proposal for issuing free bonus shares to all categories of shareholders, excluding the promoter group (comprising of Reliance Energy Ltd. and the ADA Group), in the ratio of 3 shares for every 5 shares held, subject to necessary approvals. The proposed bonus offering will result in reduction of the cost of Reliance Power shares below the IPO price as follows: Rs 269 per share for retail investors, 40% lower than the IPO price of Rs 430. Rs 281 per share for other investors, 37% lower than the IPO price of Rs 450. In a related development, Mr. Anil D Ambani, Chairman, Reliance ADA Group, on February 24, 2008 simultaneously announced a voluntary contribution of 2.6% of his shareholding in Reliance Power to Reliance Energy Ltd., to protect the Company from any dilution of its existing 45% stake in Reliance Power, as a result of the bonus proposal. Accordingly, Reliance Energy’s stake in Reliance Power will be maintained at the existing level of 45%, and the revised shareholding pattern of Reliance Power will be as follows: ----------------------------------------------Previous Existing ----------------------------------------------Anil D Ambani

45%

40%

Reliance Energy

45%

45%

Public shareholders

10% 15% -----------------------------------------------

The reduction of Mr. Ambani’s shareholding in Reliance Power by 5% from 45% to 40%, represents a contribution of nearly Rs 5,000 crore (US$ 1.2 billion) by him, in favor of nearly 6 million investors in Reliance Energy and Reliance Power. Commenting on the move, Mr. Ambani said, “I have been personally concerned by the notional losses arising to millions of long term investors in Reliance Power, as a result of a dramatic adverse change in sentiment in global and domestic capital markets, subsequent to the pricing of our IPO.

An overview of Reliance Power IPO: Reliance Power IPO has been issued by Reliance Power Limited. Reliance Power IPO was issued on 15th January, 2008 and closed on 18th January, 2008. Reliance Power Limited Company is planning to generate capital worth Rs. 11, 700 crores through the IPO. This makes it the largest IPO in the country as on 17th January, 2008. The price band of the equity shares of Reliance Power IPO has been fixed at Rs. 405- 450 per equity share. The total size of Reliance Power IPO is around 26 crores equity shares. Reliance Power IPO will be listed on the National Stock Exchange (NSE) and also on the Bombay Stock Exchange (BSE). The lead bankers of Reliance Power IPO are Enam Securities, Kotak Mahindra Capital Co, ABN Amro Rothschild, ICICI Securities, JP Morgan Chase & Co, UBS AG and

Reliance Power IPO Analysis Reliance Power Ltd. IPO details: Price Band: Rs. 405 - 450 per share Issue opened between: January 15 - 18, 2008 Book Running Lead Managers: Kotak, UBS, Enam, I-Sec and others To List on: NSE and BSE Market Cap post-listing: Rs. 1017 billion or $25.7 billion (based on the cap price)

Highlights: Reliance Power Limited (Reliance Power), part of RADAG has been set up to develop, construct and operate power projects domestically and internationally. It aims to develop 13 power projects with an aggregated generation capacity of 28,200 MW.

Project going on all over India

Significant power projects spread all over India

Reliance Power will have a diversified project portfolio in terms of geography, fuel mix and technology. Nine of the proposed thirteen projects are coal-fired or gas-based and two of those have fuel security; the rest are yet to be finalized. In our view, for such huge capacity, fuel linkage is of paramount importance (see status of projects on Long term PPAs for 8,560MW have been signed, constituting just 32% of the

aggregated generating capacity. Of these, Sasan project (based on domestically procured coal) and Krishnapatnam project (based on imported coal) have been signed at a tariff of Rs1.19kw/h and 2.33kw/h per unit respectively, the differential attributable to the high cost of imported coal. A large number of PPAs are yet to be signed, reflecting some ambiguity on profitability. We believe equipment sourcing will be critical for Reliance Power being able to commission projects on schedule. Other key factors, apart from capital costs, are timely deliveries of equipment and maintenance costs. We believe the Group can draw synergies from the expertise of Reliance Energy in EPC in executing projects of Reliance Power. Our concerns include lack of fuel linkages except for 2 projects, coal prices and gas and equipment availability. Also in view of the gap between the aggregate project outlay of Rs1, 12,129Cr and post-IPO net worth of 13,707Cr, we believe

Reliance Power may have to opt for further equity dilution going forward, in order to maintain a manageable debt-equity ratio going forward. While the high promoter holding of around 90% post-listing is a positive, it may be viewed negatively from the point of view of minority shareholders, since the latter will enter the company @ Rs450 per share vis-à-vis promoters’ average cost of Rs16.92 per share. Given the long gestation period of projects, which are likely to get commissioned from FY10 onwards, we have considered non-earnings related valuation parameters. The valuation of the IPO in terms of price/book (7.4x FY08E) appears expensive vis-à-vis NTPC (2.8x) and Tata Power (4.5x). The issue appears expensive, also on the basis of asset valuation (estimated valuation of generating capacity) in FY13. It is only on the basis of FY17 estimates, that the issue looks attractive. However, we believe the aggression and track record of the promoter group in shareholder wealth creation in all its businesses including telecommunications, power distribution, financial services and entertainment is likely to have a positive rub-off effect on this IPO as well.

Fuel used by various projects of reliance power

OBJECTIVES OF STUDY

The objectives of the studies are as follow: Primary Objective  Understand the affected of Reliance Power IPO on Indian share market

Secondary Objective  Factors responsible for the fall in price of Reliance Power equity  Perception of a retail investor toward Reliance Power before listing of IPO

RESEARCH METHODOLOGY

The research is exploratory Research. The data is collected from various sources like Internet, News paper, Magazines, staff of Reliance money other broking Houses Personals .

TOOLS OF ANALYSIS The data collected is shown through Graphs & pie chart Soft wares used are SPSS & MS WORD

DATA COLLECTION Source of data collection is Secondary

LIMITATIONS  Time Constraint  Resources were limited

DATA INTERPRETATION

Performance of Reliance Power share price

 From the above graph we can interpret that the share price of reliance power is most of the time above the BES Sensex 30 index

 The reliance power equity in other ways we can say is driving the whole Indian equity market

Suggestion: BUY; Target price – Rs. 142 Open High Low Last Price

138.00 141.90 133.05 135.05

Fig 1: Price movement bar chart - Reliance Power The price of Reliance Power is currently moving in a trend (figure 1), but on a close look it can be identified that the price is not following the trend line perfectly as lot of

deviations exist. One point to note is that the overall movement is upward i.e. the major trend is Bullish with minor Bullish & Bearish trends. Any decision of whether to buy or sell the stock cannot be made just by looking at this chart, as the trend is not pretty clear; and thus other tools are used as described below.

Fig 2: ADX chart - Reliance Power As shown in figure 2, the ADX value of Reliance Power is high enough (=47.96), therefore assuring the presence of the trending phase. Thus, the trend follower tools can be used.

Fig. 3: MACD chart - Reliance Power Currently, the MACD line (figure 3) is also above the EMA(9) line, therefore further supporting the trend lines (of figure 1) that the Bullish phase is present. It should be noted that the gap between the MACD and EMA(9) line is very small, and thus indicating that Bulls are getting weak. Therefore, there are chances that Bears might get a lead in the coming sessions.

Fig 4: Bollinger Bands - Reliance Power In order to further confirm the presence of Bullish phase, Bollinger Bands are drawn with SMA(20) as the base line (shown in figure 4). As can be seen, the price is moving close to the upper band therefore approving the Bullish phase. But this also increases the chances of a trend reversal in the coming sessions. Trend might reverse if the price goes below the SMA(20) line and is not able to cross it again; thus care has to be taken after investing. It is advised to the readers to buy the stock with a target price of Rs. 142. It should be kept in mind that the current trend is already weakening; therefore care should be taken after investing.

OBSEVRATION & FINDINGS  An IPO can be a risky investment. For the individual investor, it is tough to predict what the stock or shares will do on its initial day of trading and in the near future since there is often little historical data with which to analyze the company.  In case of Reliance Power the shares were oversubscribed 73 times i.e. for 1 share there were 73 applications  Share market doesn’t responded as the applicants  On Monday 20th January 2008 the first day of trading of R power. R power shares along with BSE SENSEX goes done by 17 % of issued price of Rs.450 to Rs.372.50. BSE goes down by 832 points in sympathy of it Now that was a disaster for retail investors this is they haven’t dreamed of  A lot happened between January 15, when Reliance Power first offered its shares for sale, and its listing. For a start, any hopes that India might go unscathed following the U.S. sub prime crisis have long been abandoned.  It used to be said that the two Ambani brothers [Anil and Mukesh, chairman of Reliance Industries, India's largest company] are keeping the stock markets going  Its found that the common man have faith in Reliance but the situation were hostile

 This faith is not ambiguous because it is based on Reliance’s past performance of its equity funds like Reliance vision , diversified power sector , natural gas & growth funds which are prevailing in market from past 10 to 12 years & doing well in market  The performance of Reliance Industries in the market is known to every investor from past decades  Due to which thousands of retail investor who are not investing jumped into the market in recent years moreover they are eager not to be left out of the profit from Sensex's rapid growth

 Reliance Power was following the trends of major IPOs of other Asian countries like China’s PetroChina which is one of the most valuable company on paper since its shares rose to 163 % in November 2008  PetroChina’s share fall by 50 % following the same trend the Indian companies slated 15 IPO for 2008 will now be postponed,

CONCLUSION “The study is on Reliance Power IPO in Indian context “ Some of the major facts which we have found are as follow  Brand image of Reliance industry specially the image of Anil Dhiru bhai Ambani Group company Reliance Power.  The Reliance is Trusted brand .  Indian Retail investors have faith in the name of Reliance  The affect on share market of Reliance Power IPO is positive but the situation of world market were hostile and due to which an adverse growth of Reliance Power equity was witnessed .  The reputation of Reliance is so good that sentiment of investor are euphoric initially towards any offering made by the company .  The projects of Reliance Power are gigantic in nature and the investment return will need time to payback to its investor  Presently Reliance is one of the largest portfolios of power generation under development in India  Reliance is Capitalizing on the growth of the Indian Power Sector

SUGGESTIONS  Company should take in account the world market scenario before making any offering to public

 The customer should also be rational while investing in IPOs

 Proper allocation of fund should be done by the investor to ascertain what quantum of fund is sufficient for investment

 A proper study of the global financial arena should be done & constraint which will hinder the growth of our investment should be well think of before investing

 For the development of the whole economy companies should rethink their strategies

BIBLIOGRAPHY Books 

 

How to Make Money in Stocks By William J. O'neil Practical Speculation by Victor Niederhoffer and Laurel Kenner Kothari , C.R Research methodology

Magazines  Business Week  Business World  Business today

Websites  www.relianceinsider.com  www.reliancemoney.com  www.moneycontrol.com  www.reliancepower.com

ANNEXURE