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B&E This Fortnight
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Issue Date - 15/03/2012
Big win for MCX IPO

After a very dull two year period for the primary capital market, the initial public offer of the Multi Commodity Exchange of India, which was also the first IPO this year, seems to have brought a ray of hope for investors. By the time of its closure on February 24, the issue had received about 54 times more bids for its shares worth Rs 350 billion. More importantly, the retail segment saw an oversubscription by over 24 times. The portion reserved for institutional investors in MCX IPO received a subscription of 50 times, while the HNIs (High Networth Individual Investors) submitted bids for over 150 times the number of shares reserved for them. In the process, the first ever IPO by any Indian stock exchange has also become the third most successful IPO so far. Until now, the Mundra Port & SEZ IPO in November 2007 was the most subscribed IPO in the Indian market and was oversubscribed 115 times. The MCX issue has fetched the bourse Rs. 6.63 billion and the share price has been fixed at Rs. 1,032. Investors are also expecting significant listing gains from the issue. MCX is India’s largest commodity exchange and is the fifth-largest commodity exchange in the world. It enjoys leadership position in the Indian commodity futures market, with a share of 82% of the overall traded turnover in FY11.

Ranbaxy’s Q4 losses

India’s leading pharmaceutical company reported a net loss of Rs.29.82 billion in the quarter ended December 31, 2011. The losses are far greater than the Rs.970 million that it incurred in the same period in the previous year. The higher quantum of loss comes at a time when Ranbaxy’s sales for Q4 have increased by Rs.16.51 billion from Rs.20.86 billion in 2010 to Rs.37.38 billion in 2011. The company has suffered losses all through the year, which is reflected in its net loss of Rs.30.52 billion for the year 2011, as compared to a net profit of Rs.552 million it made in the year before. The reasons for the burgeoning loss include the settlement of a probe by the US Justice Department and foreign exchange losses due to rupee depreciation.

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