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The tricks of the IPO trade

The tricks of the IPO trade
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First Published: Wed, Feb 27 2008. 12 24 AM IST
Updated: Wed, Feb 27 2008. 12 24 AM IST
It was quite instructive to read “Great Indian IPO trick” (Mint, 21 February), T.R. Ramaswami’s article on the tricks employed by company promoters and merchant bankers to dupe investors. It would also be naive to expect ordinary retail investors—the “aam aadmi”—to be discriminating about such overpriced initial public offerings (IPOs), especially when the finance minister of the country himself gets very enthusiastic about an IPO—and endorses it with words such as: “It is a reflection of the confidence of the world community in the future of India” and “Investors seem to be confident about the future of Indian economy.”
–Rajesh Agrawal
This refers to your Quick Edit (Mint, 22 February). The Supreme Court judgement is indeed a jolt to all in corporate India. It would be interesting to observe, and sobering to participate in, the response of the corporate sector to such a landmark event.
However, I disagree with your view that the tragedy that befell the employee of the IT company is as much a state failure as a corporate one.
Many citizens could point to numerous instances where the action and reaction of the organs of the state fall short of those necessary to provide the desired level of safety. This could be due to the security agency failing to apply the authority that it does possess. But, to prevent all crimes of this kind, the police would need to be empowered to such an extent that it would very likely impede daily activity. One consequence would be to add to the cost of business.
Was this a case where the employer was negligent? After all, the IT company knew, or must know, when a particular shift ended and if a lone female employee was due to return home late at night.
If the employer arranged for transport for the commute back home, it is also the employer’s responsibility to verify that the vehicle was road-worthy and the driver’s antecedents and his conduct were within acceptable bounds. If an employer were to take the stance that his responsibility ended the moment the employee went out of the premises, it could impact the availability or quality of human talent.
In this case, the police could be deemed to be equally responsible if they were provided prior notice before the departure of the employee. And if they had approved the appointment of the driver. Neither of these are practical or cost-efficient measures.
Much as the decision of the Supreme Court is painful to accept, it would be equally bad to shift the blame to the state. The right approach would be to treat this as a learning step in the evolution of this still young industry that is so important for the future of the nation and its young citizens.
–Anand Shanbag
This refers to the OurView “Making bank mergers work” (Mint, 25 February). With 2009 approaching, mergers and acquisitions will be the order of the day in Indian banking. As rightly pointed out by you, mergers of the biggest banks in India do not seem to be a practical option as they are public sector banks.
The chances of getting private banks merged are higher, given the red tape and union pressure at public sector banks.
Also, some kind of liberty and freedom in decision making should be granted to public sector banks by the Reserve Bank of India if Indian banking is to be opened up in the real sense.
–Bal Govind
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First Published: Wed, Feb 27 2008. 12 24 AM IST
More Topics: IPO | Economy | IT Company | Employer | Citizen |