The Mahindra Holidays share offer is the only big initial offer by any company in the past 12 month and the near 6 per cent gains the stock closed with on the first day of listing could hold out hope for other prospective issuers, provided the stock holds on to its gains.

Keshub Mahindra, chairman of M&M, said, "We hope to fulfill the promises for our investors who have once again shown confidence in us."

Quality draws investors, come hail or high tide—at least that seems to be the lesson to draw from Mahindra Holidays' IPO and listing performance on Thursday.
The stock after a strong opening stayed within a Rs 340 to Rs 311 band on the BSE and closed at Rs 317 rupees a premium of close to 6 per cent over the issue price of Rs 300 and the management was clearly enthused.

Anand Mahindra, vice-chairman of M&M, said,"We had made this promise in ‘94. We hope in this changing environment we are able to fulfill our promises in a short period and not take so much of time.”

Clearly the Rs 277-crore Mahindra Holidays IPO has raised money to fund the company's new resorts at Tungi in Maharashtra and Theog in Himachal Pradesh as well as expansion of three others at Coorg, Ashtamudi and Ooty.
But its promising listing may not open the floodgates for other IPOs, as merchant bankers remain cautious in their outlook citing issuer credentials and pricing to be key factors in determining success.
Tarun Kataria, MD of HSBC, said, "International markets are looking at the Indian markets and all the BRIC countries. Euphoric pricing of 2007 may not be a case now, as right pricing and how much are you offering to investors."
Meanwhile, the success of Club Mahindra IPO is a clear indication of investor appetite getting revived in the Indian markets. But it would be interesting to see if the momentum would continue in the coming months.

source: NDTVPROFIT