New Delhi, June 7 -- What do Reliance Power, DLF, Visa, Agricultural Bank of China and Saudi Aramco have in common? Each represented the largest-or among the largest-equity offerings of their time. Each of these was greeted with euphoria, oversubscription and breathless media coverage. And each one of these was followed by a significant decline in the markets.

In January 2008, Reliance Power raised Rs.11,700 crore-then making it India's largest initial public offering (IPO)-following a quarter in which aggregate IPO issuance had already breached an all-time record. The Nifty 50 peaked within weeks and lost 55% over the following year. Coal India's Rs.15,475 crore initial share offering in October 2010 preceded a 28% correction in the Nif...