Delhi-based bike dealership raised Rs 4,800 crore through an IPO intended to gather just Rs 12 crore

A small Delhi-based bike dealership, Resourceful Automobile, recently raised Rs 4,800 crore through an IPO intended to gather just Rs 12 crore. Despite disclosing multiple business risks, including high debt and negative cash flow, the IPO was oversubscribed nearly 400 times, largely driven by retail investors. This highlights the irrational exuberance in India's stock market, where inexperienced investors, influenced by recent market gains and media hype, are ignoring potential risks. The situation serves as a warning to investors to conduct thorough research before getting caught up in the market frenzy
A small Delhi-based bike dealership, Resourceful Automobile, recently raised Rs 4,800 crore through an IPO intended to gather just Rs 12 crore. Despite disclosing multiple business risks, including high debt and negative cash flow, the IPO was oversubscribed nearly 400 times, largely driven by retail investors. This highlights the irrational exuberance in India's stock market, where inexperienced investors, influenced by recent market gains and media hype, are ignoring potential risks. The situation serves as a warning to investors to conduct thorough research before getting caught up in the market frenzy.

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