However, the lead bookrunner to the IPO says that Mascot received a very good response from the investors, but is tight-lipped about the subscription amount. Mascot Systems' bookbuilding portion, which closed on May 2, of 22.5 lakh shares had been oversubscribed 10 times. The company had offered 22.5 lakh shares through bookbuilding in a price band of Rs 480-580. Sensing the market mood, the company had offered 7.5 lakh equity shares (fixed price portion) at the lower end of the price band. Despite this, the company has just managed to sail through with its IPO.

According to a Delhi-based analyst, the lacklustre response from investors cannot be attributed to a single factor - the current pounding of IT stocks on the bourses. `Mascot's IPO was in fact overpriced,' the analyst adds. Mascot had offered 7.5 lakh equity shares of Rs 4 each at a premium of Rs 476. If the facevalue of each share is taken at Rs 10, the premium would work out to whopping Rs 1190. The company had offered equity shares at a price-earning multiple of 17 (annualised EPS for 2000 based on pre-issue capital).

Investors turned cautious especially after Cinevista Communication, which belonged to one of the most sought-after sectors on the bourses alongwith IT, listing at a steep discount to its IPO price on the bourses.

While Mascot Systems's IPO was open for subscription, KPIT Systems, Zenith Infotech, Telesys Software, Shree Rama Multitech and Cinevista Communications were all trading below their IPO prices.

``The writing on the wall is very clear: The shakeout has already began, but investors will get lot of investment opportunity in reasonably priced IPOs from good companies,'' said a Delhi-based broker.

The investor response to Mascot's IPO may force several other IPO candidates either postpone their issues or reduce premium. In fact, banks and merchant bankers have started advising companies not to rush with their IPOs and wait for the stock markets to pick up.

However, those companies who have already announced their IPO date may face a rough weather. SoftSol India's Rs 34.12-crore IPO was closed for subscription on May 8. The investor response has not been very good in this issue, too, according to one market source. The company, which is into onsite software development, had offered 14.35 lakh shares at a premium of 85 per share. Balwas eCom India, which was established recently, is going public with its Rs 3.5-crore IPO at par. The issue opens on May 15 and closes on May 20. Computer Power India is offering as many as 2 crore shares of Rs 1 each at par, aggregating Rs 2 crore. Lead managed by Munoth Financial Services, Computer Power's IPO is currently open for subscription and closes on May 11.

Southern Online Services recently offered 13.4 lakh shares of Rs 10 each at par, aggregating Rs 1.34 crore. Incorporated in November 1999, Southern's IPO opened on May 5 and closed on May 9. Mega Channel, which was established in 1996, is also offering 38.3 lakh shares of Rs 10 each at a premium of Rs 8, aggregating Rs 6.89 crore.

Some of the big IPOs in the pipeline are Action Microtek, Binary Semantics, Computech, Datamatics, Infrasoft, Microland, Microworld, Planetasia, Radiant Infocom, Shonkh Technologies, SRA Systems, Wintech and Zensar.