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IPO refers to Initial public offering,
When a promoter needs huge funds to promote his idea he goes onto give a IPO,
IPO is made in media and newspapers where the Idea is clearly promoted and asks for the public to make contribution or invest in his company,
IPO is a tool through which a potential idea is materialized in the market through public investment.
When the owner of a company is in shortage of the amount and he wants to make his company public by dividing his company to pieces and making partners from the public, he make an initial public offering.
Initial public offer
before ipo they have to get approval from sebi for ipo then the company can advertise and issue ipo.
IPO – Initial Public Offering
Process – When any company thinks of raising capital through public they go for issuing IPO.
Firstly the company gives an advertisement about the nature of the company to be started along with the capital requirements.
Interested Public (People) take up the application issued by the company by paying the application fee and the share amount they are willing to contribute to the companies capital.
In turn the share holders are given share certificates for the shares contributed by them towards capital.
- IPO – Initial Public Offering – One of the two times in which the company sells shares directly to the public.
- Application can be done either online / manual
- Amount for the number of equities applied is locked till the allotment.
- In case of allotment, amount is withdrawn & shares are delivered in return
- Otherwise, the locked up amount is freed.
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