Co. needs capital to start or expand the business.
And so, companies invite normal people like you and me to put some money in their company so that they can run it efficiently and in return investors get a share of
whatever profit they make.
Co. issues IPO As per SEBI guidelines.
Once cash received by co. the co. issues certificates called shares.
@sanjay72 Could you please recheck your answer for “Can share holder has right to ask for refund / can he ask for dividends?”
Actually the shareholder has no right to ask for refund / dividends from the company. The money invested on business cannot be refunded, because the money has already been invested in the business.
The management (Board of directors) who runs the business may propose the dividends that shall be approved by shareholders.
Thank You Suresh.
Its more clear now.