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Coal India- experts recommend booking profits after mind-boggling debut  

Mumbai: Coal India shares surged as much as 39% in their $3.43 billion IPO debut on Thursday as investors snapped up a stock that is a proxy for surging growth and energy demand in Asia’s third-largest economy.




An attractive IPO valuation for India’s dominant coal miner spurred demand from investors who applied for more than 15 times the number of shares on offer in the country’s largest-ever IPO.



The rousing response to the state-controlled firm’s offer sets an upbeat tone for future share sales by a government looking to shed stakes in some 60 companies over the next few years. It also puts pressure on New Delhi to price future offerings at discounts to peers.



“Coal India is a bit expensive now. But, it is drawing a huge premium as it is a likely index candidate,” said Deven Choksey, managing director and CEO of KR Choksey Shares, who said the stock remains attractive for long-term investors.



Coal India shares opened at Rs. 295.70 on the Bombay Stock Exchange (BSE), compared with a Reuters poll forecast for the shares to rise to about Rs. 287 on their first day of trade. The stock rose as high as Rs. 340 for a gain of 38.8% and accounted for more than half the volume traded on India’s two main bourses.

http://www.livemint.com/2010/11/04092955/Coal-India-up-39-on-debut-bo.html

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