IPO Basic
What is the Meaning of an IPO?
IPO full form is Initial Public Offering. As the name suggests, an IPO is the first offering of shares to general public. Prior to an IPO, shares might be offered to a different set of investors such as anchor Investors, Private Equity Funds, Venture ...
Why does company come up with an IPO?
Companies need funds for their regular operations, expansion plans etc and IPOs allow them to raise loads of equity capital in a distributed manner. Unlike bank loans and other forms of debt, equity is interest free capital for companies.
Who can invest in IPOs?
Individuals including Minors Through Guardians, HUFs, Bodies Corporate, NBFCs, Bank & Financial Institutions, Mutual Funds, National Investment Funds, Insurance Funds, Insurance Companies, Venture Capital Funds, Alternative Investment Funds, ...
What are categories in which IPO allotment applications can be made?
· Qualified Institutional Bidder (QIB) – QIBs are qualified institutional buyers as defined by SEBI’s Issue of Capital and Disclosure Requirements (ICDR) regulations. Generally, 50% or 75% of the offer is reserved for QIBs. Typical examples ...
What is ASBA (Application Supported by Blocked Amount)?
ASBA allows the investors money to remain with the bank till the shares are allotted after the IPO. The funds are transferred after the allotment and to the extent of allotted shares. This is an application mechanism which completely eliminates the ...
What is DRHP & RHP?
DRHP stands for Draft Red Hearing Prospectus & RHP stands for Red Hearing Prospectus. A DRHP is also known as the offer document. It is prepared by the merchant bankers appointed by the Company who wish to float IPO, as a preliminary registration ...
What is Book Building?
Book Building is a process undertaken by which a demand for the securities proposed to be issued by a corporate body is elicited and built up and the price for such securities is assessed for the determination of the quantum of such securities to be ...
What is minimum number of days for which bid should remain open in book building?
Book should remain open for minimum of 3 working days.
What is the floor price in case of book building?
Floor price is the minimum price at which bids can be made.
Can the Individual Investor use book building facility for making an application?
Yes.
What is Bid Lot?
A Bid Lot means minimum Quantity of Shares to Apply in IPO. Generally it is being set at an Investment amount less than or near to Rs. 15,000.00.
What is IPO Timeline ?
IPO Timeline is the Tentative Schedule Dates for IPO Opening, Closing, Allotment, Funds Unblocking, Stock Credit in Demat Account & Listing.
What are Registrar and Transfer Agents?
Registrar & Transfer Agents are appointed by the respective IPO Floating companies for the work related to Allotment & all Post Allotment Services like Communication, Transfers, Records of Shareholders, Bonus–Dividend etc related work or any other ...
What is the meaning of Book Running Lead Manager?
Book Running Lead Managers (BRLMs) are Appointed by the Respective Company, who wish to float IPO. BRLMs’ work is to Manage the IPO Process from Beginning (Applying for IPO with SEBI with Basic Prospectus & Company’s Details) to IPO Subscription ...
Are there any charges for Applying in IPO?
No, There is not any Charges for Applying in IPOs.
What is the Meaning of “Basis of Allotment” for Different Categories & what is the process of Allotment?
Basis of Allotment is the process of allocating shares to Applicants of IPO. This allotment of shares is based on conditions which must be satisfied before the shares are issued. Allotment Process is done by Registrar & Transfer Agents. They identify ...
How & where to check Subscription?
Subscription figure are available on Stock Exchange websites. www.nseindia.com, www.bseindia.com, as per respective bids received on the exchanges & also combined Subscription figures available on both websites. Combined Subscription figures are also ...
How & where to check Allotment Status?
IPO Allotment Status is Available on its Registrar & Transfer Agent’s website after Announcement of Basis of Allotment.