Gaurang Shah, the Assistant. Vice President of Geojit BNP Paribas Financial Services has recommended that investors should buy Coal India shares on it’s listing day
Speaking to the ET- Mr. Shah recommended that small and retail investors should use the money they will get a refund to buy and accumulate more shares of Coal India. Only those who have taken loans as application funding would exit the stock he felt.
He also further added that he expects the stock to list between Rs 280 to Rs 300 on its listing date. Coal is one of the most used commodities in the economy and thus he does not foresee a slowdown in the growth and prospects of the company.
He further added that in one year’s time he expects the stock to cross at least Rs 400. Geojit BNP Paribas has a buy recommendation on the stock and many other brokerages too are positive on the prospects of Coal India.
Shares allotted under Coal India IPO are going to list on the 4th November which is a day before Diwali and traders and investors believe they could ‘t have asked for a better date. The markets have traditionally scaled new peaks during the Diwali sessions.
Many brokers have paid their retail clients up to Rs. 4,000 to apply on their behalf. Some brokerages even opened new Demat accounts just for applying for Coal India’s IPO.
During the Reliance Power public issue of 2008, retail investors were offered Rs 7,000 for each application by brokers but then most of them then ended up burning their hands as the stock dipped below its issue price on its the first day of trading.