What my experience in the markets has taught me is that most of the Indian retail investors in the stock market can at best be termed as "Buffoons". They simply piggy back on a well heard name or a friend's referral and invest in the markets. I personally think that the king of over hyped companies in India is Reliance. Reliance on the basis of its brand name has managed to attract investors even for companies whose current business is running in air and have no full scale operations. Take Reliance Natural Resources Limited for example. The stock is currently trading at Rs 94.60 which is a 440% increase from its list price of Rs 17.50 and all this is based purely on future expectations and no current fundamentals. Another example is Reliance Petroleum Limited which is years away from being operational and is still trading at Rs 157.05 which is a premium of 93% over its list price of Rs 81.10.Reliance Power Limited is my personal favourite for "Buffoon Makers". As per a research report by Edelweiss Capital Research, the company will start full scale operations by 2017 but is currently trading at Rs 547.80.
I think Reliance ought to come out with a new company "Reliance I Will Start Business Sometime Limited" and I'm sure it will find investors for that too.
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