Yahoo's 'No', big listing & more... - Views on News from Equitymaster

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks

MEMBER'S LOGINX

     
Login Failure
   
     
   
     
 
 
 
(Please do not use this option on a public machine)
 
     
 
 
 
  Sign Up | Forgot Password?  

Yahoo's 'No', big listing & more...

Feb 11, 2008

  • Asian markets continue to reel in the red, most of them probably playing catch up with other global markets for the long holiday they had last week. Currently, while indices in Hong Kong and China are down almost 2%, the Korean index is trading weak by 3%. Fears of a US economic recession has failed to subside despite the Federal Reserve's action of cutting interest rates and putting more money in the hands of bankers to lend. The pain on the back of subprime losses has been so severe for the big financial institutions in the US that they fear to lend. Further, due to inflation fears emanating from the central bankers around the world (like the UK, Euro and Australia), stockmarkets are not seemingly ready to bite the bait.
  • As far as Indian stock market are concerned, participants are waiting for the big listing of Reliance Power. The company, which recently sold off 228 m shares to retail and institutional bidders, will list its shares on the stockmarkets today. It offered its shares at a price of Rs 450 (Rs 430 for retail investors), and has seen its IPO oversubscribed more than 70 times. Importantly, valuations were not even talked about as investors poured in applications for getting pie of the company, which does not have even a single rupee of business earnings.

    What is more, investment bankers for the issue turned sellers of dreams, prophesising about the listing day gains of this IPO. But subsequently, the global market turmoil, which has impacted Indian stocks as well, has led to the same applicants running helter skelter to issue stop payment requests to their banks for the cheques that were issued for applying to this IPO. Many succeeded and many didn't. Now, there are permutations and combinations made out for the listing price. Some commentators have even gone on to say that the listing price of this issue will determine the course of Indian stock markets!. Now, that is shortsightedness at its best...again!


  • Microsoft's US$ 45 bn bid for the beleaguered Yahoo took an about turn late last week as the latter indicated of its plans of rejecting the bid, citing that it 'massively undervalues' the company. In fact, Yahoo has asked for nothing more than US$ 40 per share, almost 30% higher than Microsoft's original bid of US$ 31 per share. Yahoo's minimum quotation is, in fact, almost 27% higher than the stock's current price and more than double its price when Microsoft had put in its bid of US$ 31 per share.

    Microsoft's aggressive bid indicated the seriousness with which it is pursuing its Internet growth strategy, as the software business growth seems to be tapering off. Interestingly, Yahoo's objection to Microsoft's bid comes after the Internet search giant, Google raised 'competitiveness' issues against the operating system major, terming the software giant as using 'hostile' means to curb competition. As a matter of fact, Google leads the Internet search space by a wide margin, having a share of 62%, compared to a share of 13% of Yahoo and just about 3% of Microsoft. Google has itself been termed as a 'monopolist' when it comes to the Internet business and smaller firms have welcomed Microsoft's proposal for Yahoo as it is seen as a way that will pare the dominance of Google.

Equitymaster requests your view! Post a comment on "Yahoo's 'No', big listing & more...". Click here!

  

More Views on News

Top 5 Recent IPO Developments You Should Know (Views On News)

May 12, 2021

So far in 2021, IPOs in India have raised nearly US$ 3 bn, the best start to the year since 2018.

How Did Mindtree Perform in Q4FY21? (Company Info)

Apr 20, 2021

Here's the rundown on the company's latest quarterly results.

How the Regulator Is Ensuring That You Can Make an Informed Decision When Investing In Debt Mutual Funds (Outside View)

Jun 17, 2021

SEBI recently introduced a dynamic scheme classification concept of the Potential Risk Class matrix for debt funds based on interest rate risk and credit risk.

Top 5 Stocks Mutual Funds Bought and Sold in May 2021 (Sector Info)

Jun 17, 2021

A look at what India's top equity mutual funds bought and sold in May 2021.

Why is Bullion so Volatile Now? (Fast Profits Daily)

Jun 17, 2021

Why have gold and silver prices become volatile recently? Find out...

More Views on News

Most Popular

Differences Between Trading and Investing

A simple to guide to understand the difference between investing and trading

Hotel Stocks Will Reward Investors (Fast Profits Daily)

Jun 8, 2021

This is why I'm bullish on the hotel and hospitality sector.

My 'Unlock' Investments (Fast Profits Daily)

Jun 11, 2021

The best unlock investments you can make in the market.

The Most Visible Sign of India's Revival is on Two Wheels (Profit Hunter)

Jun 9, 2021

Investing in the best stocks could result in wealth compounding on a massive scale.

How I Discovered a 400-Year-Old Open Secret to Extreme Wealth (Profit Hunter)

Jun 11, 2021

Charlie Munger's open secret about investing success.

More

India's #1 Trader
Reveals His Secrets

Secret To Increasing Your Trading Profits Today
Get this Special Report,
The Secret to Increasing Your Trading Profits Today, Now!
We will never sell or rent your email id.
Please read our Terms

S&P BSE SENSEX


Jun 17, 2021 (Close)

MARKET STATS