Craze for public issues by FERA companies
Public issues by companies diluting their foreign equity under the Foreign Exchange Regulations Act (FERA) are being preferred by investors. These issues have evoked good response in the past few months, as small investors have reaped good benefits and there are fairly good chances of such issues being quoted at a premium. Consequently, there is a craze for such issues amongst prospective investors. All the stock exchanges in the country have been directed that in the event of over subscription of a public issue, the basis of allotment should be finalised keeping in view that it is predominantly in favour of applicants in lower categories of 50 to 200 shares of the face value of Rs. 10 each. Such steps protect the interests of genuine small investors.
