The catastrophic fall in stock prices after the election results seemed set to bury the plans of many companies planning to raise public money. However, NDTVs opening suggests that investors may keep an open mind about new issues.
Barely six months ago, the Indian capital market struggled to cope with massive influx of foreign investment.
It was starved of good investment options and the Securities and Exchange Board of India played a role in persuading the government to consider disinvesting public sector undertakings through the public offer route.
The SEBI chairman had then argued that soaring stock prices could be checked if fresh equity from good companies is available to absorb pent-up demand.
Despite a few hiccups, all six PSU offers were oversubscribed. The government raised Rs 10,000 crore in March and planned to raise Rs 100,000 crore from the primary market, before it was voted out of office.
The enormous public interest generated by the PSU offerings breathed life into the dormant primary market. Several interesting offerings like Patni Computers, Biocon, TV Today and others sailed through with offers worth another Rs 8,000 crore.
The Left Fronts anti-privatisation statements, however, caused stock prices to collapse and furious investors found most of their newly acquired PSU scrips quoting well below the offer price.
As far as private companies are concerned, it has been a mixed bag. Some continue to be in positive territory despite the stock crash while others have dropped substantially below the offer price.
Sonia Gandhis decision to propose Dr Manmohan Singh as Prime Minister has changed the situation again.
Investors will continue to be wary about public sector offerings such as NTPC or Central Bank of India, or even semi-PSU IPOs such as Infrastructure Development Finance Company or Infrastructure Leasing & Financial Services.
The much-awaited Tata Consultancy Services issue may still attract investor interest but the size and the price of the shares may be reworked.
Shoppers Stop, Sony and Hutchison Max will also attract support if they have a good story and are attractively priced.
The revival of secondary market on Tuesday and Wednesday indicates that worried foreign institutional investors would give the new government led by Dr Singh a fair chance before deciding whether to pump in more money or to withdraw from India.
Now if the Left Front can be persuaded to refrain from making any policy statements at all, then the market would have a fighting chance to make a real recovery.