Abhishek Loses Over Rs 1 cr on Reliance Power IPO

EXCLUSIVE! Abhishek loses over Rs 1 cr on Reliance Power IPO

Had applied for shares worth almost Rs 1,000 cr in Reliance Power IPO; lost over Rs 1 cr on Day 1
AMONG the millions who wished the Reliance Power Initial Public Offering (IPO) would change their fortunes, there was a close family friend of ADA (Anil Dhirubhai Ambani), Abhishek Bachchan.

Junior Bachchan put in close to a whopping Rs 1,000 crore, which is almost 10 per cent of the IPO’s value, hoping for a substantial allotment and good returns. That he lost over Rs 1 crore on Day 1 itself is a different story.

Documents with MiD DAY reveal that Abhishek applied for a mind-boggling 2,19,00,000 (Two crore nineteen lakh in words, as applications often ask) shares at Rs 450 base value. That’s a whisker away from Rs ONE THOUSAND CRORE.

While most retail investors have been happy with the 15-odd shares they may have been allotted, as an HNI (High Net worth Individual), Junior B was allotted 1,37,256 shares, according to the application and allotment details available with MiD DAY. Let us do a little bit of math. That works out to shares worth above Rs 6 crore.

Abhi expected to earn Rs 7 to 9 cr

So as the Reliance Power shares dipped 32 per cent to Rs 372, Junior B lost around Rs 1 crore.
But there is more to it. As per the rules, as an HNI, if the allotment was to have been done in totality, Junior B would have had to pay the entire amount.

Incidentally, considering that he paid advance tax of Rs 1.75 crore, as indicated by the income tax authorities, he is expecting to earn approximately Rs 7 to 9 crore this year.

Clearly, to make a payment of almost Rs 995 crore or Rs 250 crore, (whether he paid only 25% which is about Rs 250 crore or the full amount could not be ascertained) he must have had a lot of cash piled up from his earlier years’ earnings to have the resources to apply for so many shares.

source:mid-day.com