It's IPO War. Play or Quit?

Are you kidding me? 6 IPO within 3 days and 9 IPO within a month available for the public to subscribe in June alone. Don't you feel there is a little bit too much for such a low volume trading country? 

Anyway, perhaps this is the best time for IPO, as no one can predict when is the bull trend going to be ended.  But also beware there may be some walls to hit, as everyone also want to grab money from IPO.

I hate MSM, because I did not get any allocaiton from the IPO. It went up so much in the first day offer no chance for us to invest anymore. I did not want to bother SENDAI and OLDTOWN, because I'm waiting for the coming 2 IPO, one of them is Bumi Armada (ARMADA). 

I won't hesitate to go for MSM and ARMADA IPOs, because they are those solid fundamental companies with proven business model and record. After studied their prospectus, I even gain better confident on them. 

Nonetheless, there is no perfect IPO around. I mean, if there are pros, there are cons as well. I saw some people commented on the drawbacks of MSM future prospect, I also heard people said ARMADA is too expensive by looking at the current PER.

Well, to me, there is no perfect IPO and solution. We are the investors and we are to judge whether it is worth to subscribe or even hold it. Of course, be prepared for the worst because anything can happen in stock market. 

Back to ARMADA's value. With 20 over times of PER, it's too expensive for most of the company, including most of the blue chips. Furthermore, ARMADA is an O&G company, which is seriously tagged as cyclical stock. If you notice it's previous years' financial records, the PER gradually turns smaller, because the company seems recovering from the worst cycle. Within a couple of years, the earning should turns the PER cheap enough to invest.

Good thing doesn't come cheap. It is consider very expensive in this case. Smart investor normally doesn't buy something consider expensive in stock market. But why PNB and some fund managers still grabbing 10% of the total shares, if it is really that expensive? 

If you subscribe ARMADA today, you are actually buying it's future earning hope in the coming few years. Moreover, this is a giant IPO. You subscribe today doesn't mean you will get it. The chance to allocate is very slim. 

Study the prospectus properly, and decide yourself. There are other 5 IPO companies waiting for you, if you are not satisfy with ARMADA. There is no point to let yourself feel uncomfortable, if you have a better option to choose. Remember, you always have a choice. 

Well, some times it is quite frustrating when you talk so much, end up you did not get any allocation. Good luck, folks!

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