In 2010,the Indian Stock Market boomed for junk IPOs with a number of low quality issues raising money.Most of these stocks made no sense from the valuation point of view and were clearly being manipulated by stock market operators in nexus with their promoters.However,it was possible for retail investors to gamble and make money in IPOs by applying and selling on the day the issue listed.If you held on then massive losses were in store as most of the IPOs are trading at less than half of their initial price.Now it seems that even this tactic has gone out of fashion with another low quality IPO Omkar Speciality Chemicals going 50% below its issue price.Note the Indian stock market has falled by more than 15% in the last month or so,with many of the operator driven stocks taking a big hit.This means that these manipulated stocks have little support and would fall to their true value which is a small percentage of their issue price.Hopefully we won’t be seeing any more these crappy junk issues for a long time.

Omkar Speciality down 53% in debut trade

Omkar Speciality Chemicals in its debut trade today plummeted by nearly 53 per cent of its issue price at BSE amid a bearish market. Omkar Speciality Chemicals, which manufactures and sells specialty chemicals, had fixed the issue price at the upper end of its price band ranging between Rs 95-98. It raised about Rs 79 crore from its initial public offer.
However, after opening at a discount of over 3 per cent from its issue price of Rs 98, the Omkar Speciality Chemicals counter nosedived by 52.85 per cent to settle at Rs 46.20 on Bombay Stock Exchange . Besides, it lost as much as 56.63 per cent in intra-day trading.