![]() Know: Why do Companies opt for IPO Advantages and Disadvantages of IPO For a Company Advantages of IPO Having the company listed on stock exchanges extends credibility and exposure. When a business goes public, it indicates that it has achieved sufficient success.As a result, the business will be in a stronger financial position to make a loan request or negotiate loan terms. This, in turn, can be used to enhance the company’s future. A company’s shares can be sold to the general public to generate significant liquidity and capital.It makes room for employee equity ownership programs, such as stock options and other compensation schemes, which draw in the cream layer’s most talented individuals. Liquidity is boosted while buying and selling stocks publicly.Companies raise funds through initial public offerings (IPOs) to finance business expansion, research investments, debt repayment, infrastructure development, and other purposes.The following are the major reasons why companies opt for IPO: Shares of the company are traded on the stock exchange(s) where they are listed when the Offer is successfully completed.The issuer then invites the general public to invest in the IPO within the predetermined timeframes.After complying with all requirements, the issuer can launch the offer.The issuer receives remarks from regulatory agencies.For the purpose of listing its securities on stock markets, the issuer submits an offer document in the required format to the Securities and Exchange Board of India (SEBI), stock exchanges, and the Registrar of Companies (ROC). ![]() After the Book Built portion, the Fixed Price portion is done in the same manner as a standard public offering.Įvery issuer of IPO must follow the following steps for a successful listing of its securities:
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