In Initial Public Offers of the past, looking at the IPO grading used to offer some clue as to the financial strength and business quality of the company. This yardstick can no longer be assured, since grading of forthcoming IPOs has now been made voluntary by the SEBI.
The reasons cited? The rating doesn’t comment on the pricing and valuation of the issue. Over-priced issues leave little room for gains. Many high-rated IPOs have tanked after listing. This lack of opinion on issue pricing can create some confusion for investors using the grading as an advisory proxy. Conflict of interest can also sometimes arise since the company being graded is the one paying for the grading.
Getting swept up in the craze for bitcoins may not be such a good idea. Last week, the Reserve Bank rang a note of caution against these currencies, highlighting the potential for financial, operational and legal risks.
There aren’t yet any regulatory approvals nor registration or authorisation obtained by the entities involved in such activities.
Reports suggest that a good many providers of bitcoin services have since shut shop. What’s more, the RBI has stated that it’s looking deeper into the usage of virtual currencies, so more action on that front may be forthcoming.
Home loans get cheaper
Here’s some New Year cheer. ICICI Bank has cut rates on new home loans by 15 basis points in a special scheme. Home loans up to Rs 75 lakh will carry 10.25 per cent interest rate, while those above Rs 75 lakh will have an interest rate of 10.5 per cent. This scheme is open till January 31, 2014.
This follows a rate cut of 25 basis points on some new loans of HDFC too, valid till end-January, and a 15 basis-point cut by SBI.
New products and services
Just don’t have the time to find the nearest office to pay your insurance premium? If you’re a Bajaj Allianz customer, it may soon become slightly easier. The insurer has kick-started a service termed “Service on Wheels”. Under this, a van will be outfitted like a customer service centre, which will then trundle around the city and outlying suburbs.
Customers can make premium payments and lodge service requests. Only cheque and demand draft payments will be accepted.
Currently launched in Pune, the service will slowly move to other regions as well. Other recently launched products include that of One Assist’s protection plan for all card frauds. Its WalletAssist protection plan covers skimming, and phishing of data, counterfeit cards, and PIN-based frauds at ATMs or merchant outlets.
Tighter rules
Among other actions it took recently, the SEBI has tightened its regulations on Collective Investment Schemes. These regulations were amended to bring it in line with the Central Government securities law ordinance. This regulates all fund pools, under any scheme, involving total sums of Rs 100 crore or more. The change also provides for continuous compliance by registered CIS entities. The SEBI also said that the government has decided to provide tax treatment for Foreign Portfolio Investors as given to Foreign Institutional Investors.