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Money Flow In Stock Market





It may soon be allowed for private equity funds to unload their stakes in listed companies through the sale route .At present the rule allows only the promoters of publically traded companies to sell their shares through the offer for sale (OFS) way .The OFS was introduced two years ago by SEBI so as to help the company's to comply with minimum public holding norms so the top 100 listed companies by market capitalization are allowed to use the OFS system to raise funds . Even there are some plans to make changes to the IPO framework as the rationalization of the minimum issue size criteria for IPO after it observed that corporate are by passing the laws .

As per the rule a company has to sale at least 25% stake of its valuation if its below 4000 crore , and if the company with valuation more than 4000 crore has to sell 10% .in IPO, now the fault in IPO norms is that if the company value is Rs 4000 crore than it can come out with an IPO of 400 crore and conversely if the value of the company is 3900 crore it has to offer shares worth Rs 1000 crores and if the company value is Rs 3500 Crores it has to end up issuing more shares and it adds to the i9ncentive of the company as they present Rs 4000 crore or above .



Investors are having their focus on long term well beyond 2015 to focus on winners ,the valuation of stocks based on current year estimates are a bit on higher side but investors are keen to work further beyond this year because there are two changes awaiting --- the revival of economy as well as growth in earning stocks , on the basis of earnings in the next two years will make them cheaper and that’s what we call hope of growth which is definitely well beyond the fear and greed factor .At present the price to earning P/E ratio is 16 times and may go up to 20 .This year the sensex has rallied 20% so far which reflects that the investors are confident. And this was just a starter , main course and desert is in horizon .Go India Go.