Stay away, lot of froth in IPO mkt, warns Jhunjhunwala

Jhunjhunwala is often dubbed by Indian media as the country's Warren Buffett

Major Indian share investor Rakesh Jhunjhunwala said he is steering clear of all initial public offerings for now as valuations have skyrocketed amid strong inflows and exuberance in equity markets.

India has had a boom in IPOs, with a record $11 billion raised this year. However, high valuations — especially for some recent insurance IPOs —have produced some weak secondary market debuts and weighed on investor sentiment in recent weeks.

“There is a lot of froth in the IPO market,” Jhunjhunwala, a billionaire who runs his own asset management firm, said at the Reuters Global Investment 2018 Outlook Summit. “Stay away,” he