Generally most people have a good knowledge about banking and insurance. But people do not have important information related to stock market and investment. Even stock market, mutual fund, IPO. Adi is such a word about which we definitely hear but we do not know much. One of these terms is IPO. You will get answers to all those questions about IPO very easily here.
What is IPO (Initial public offering)
When a company issues its stock or shares to the public for the first time, it is called IPO (Initial Public Offer). After this, the company’s shares can be bought in the stock market.
Reasons to bring IPO
When a company needs additional capital, then it issues IPO.
SEBI’s opinion on IPO
Securities and Exchange Board of India i.e. SEBI (Securities and Exchange Board of India) is a government regulator for companies that bring IPO. It makes the companies bringing the IPO strictly follow the rules. Companies are obliged to give all kinds of information to SEBI. This is a kind of mandatory condition that the company will give all its information to SEBI. Not only this, after bringing the IPO, SEBI also gets the company investigated, whether the information given by it is correct or not.
Investing in IPO
Although IPO is considered a risky investment, as it does not contain any data or information regarding the progress of the company’s shares, yet for the person who invests in the stock market for the first time, IPO is a better option. is option. If you want to make a future in the stock market then you must know about IPO.
Benefit from IPO
In the IPO, the capital invested by the investor goes directly to the company. However, in case of disinvestment, the capital received from the IPO goes directly to the government. Once the trading of their shares is allowed, then they can be bought and sold, yes one thing must be remembered, the investor will be responsible for the profit and loss arising from buying and selling the shares.
How to invest in IPO
Whenever you select a company to buy IPO, first of all your broker should be the best. Try to choose the company in conjunction with the broker. Compare three or four other companies with the company you are choosing. Invest only after seeing the progress of all these companies for a few days. The opinion of the rating agency also matters a lot. Also see the price of the company’s IPO, see the credibility of the promoter of the company in the market and keep getting information about the company’s IPO from other investors.
Be cautious before investing
Many times people do not have complete information about the IPO, due to which they often suffer huge losses. Always be cautious, sometimes old investors sell their shares through IPO, and in some cases offer new shares along with the shares of old investors. IPO investor should know the reasons for selling shares of old investors. If you want this business to grow well and you always have profit, then before moving forward in this field, you must pay attention to every little thing.
How much can you earn from IPO
Although it is usually very difficult to say how much money can be earned by investing in an IPO. Also, the return of IPO depends a lot on the current state of the market. Also, the GMP of that company i.e. “Grey Market Premium” The higher the GMP of the company, the higher the percentage on the day of the company listing. Removes returns and gives it to its investors. Even many companies have removed returns up to 100-120% from their premium price, that too within 15 days from the day of listing, so you can think that if the right company If you apply in the IPO then it can also make you rich.