Coal India's initial public offer (IPO) is likely to attract more investment from foreign institutional investors (FIIs) as the IPO is attractively priced, market experts said today.
The Coal India IPO is fixed at a price-band of Rs 225-245 a share. The government expects to raise over Rs 15,000 crore through the IPO, which will open on October 18.
"The Coal India IPO has been priced attractively. This will ensure inflow of money into the Indian market, especially from FIIs. The IPO will act as a catalyst to bring more FII investment into the market," ICICI Prudential Asset Management Company's Deputy Managing Director Nilesh Shah said on the sidelines of an event here today.
The issue will also bring back retail investors, he said. "Similar to the Maruti Suzuki IPO, the Coal India IPO will also attract more investors to India. The Indian market will be driven by flows from FIIs in the coming years," he said.
According to another expert, investors would like to have exposure to Coal India's unique business.
"The IPO is reasonably priced. Investors would like to have exposure to the company's unique business as it enjoys a monopoly status today," Bajaj Allianz's Chief Investment Officer Sashi Krishnan said.
Birla Sun Life Insurance Company's Chief Investment Officer Vikram Kotak also said that the offer is "not costly" and the market is seeing huge investments coming in.
All the three companies are planning to invest in the IPO.
"We have not yet finalised our plans for investment but we are looking at the possibility," Krishnan said.
