IPO guide, all you need to know about IPO investment.
Investing your money doesn’t have to be as complicated as rocket science.
Investing in the stock market is an attractive option, picked by many for its long- and short-term benefits.
One of the popular and reliable way to invest your money is through IPO’s. It is a great way to increase wealth,
whether you are new to investing or a long-term investor wanting to use the listing gains to profit off your
investment. Investors are always on the lookout for upcoming IPO list and excited during a new IPO launch.
In order to invest in IPO, you will need to open trading account online, worry not these days you
can open demat account online and begin direct equity investment with a few clicks.
Understanding the system of investing in IPO’s is critical. Here are a
few things you will need to know before you participate in investing in IPO’s.
What is an IPO?
Initial Public Offering is the first step by the company to go public for raising funds. New IPO launch
are big events in the industry and an important move for investors. New IPO companies are both large and small in size.
The company normally raises money to expand and for various corporate purposes such as an expansion of capacities,
repayment of existing loans, listing, etc. Few reasons why a company also goes public are, IPO is a better option
than to take a debt, diversify ownership, early exit of investors.
You can find the new IPO companies in the upcoming IPO list in the latest IPO news section on our website.
Why should you invest in an IPO?
An Investor can invest in an IPO either for listing gains or for long-term capital appreciation if the valuation is reasonable
as compared to listed peers. Another plus is that there is no minimum or maximum amount of IPO.
Many, new IPO’s companies offer discounts, known as Offer for sale while launching their IPO’s
it is a great choice to start creating wealth early on.
How to decide on which IPO to apply for?
While making the decision to apply for new IPO stocks, an investor should look at the Promoter
Background, Corporate Governance, Fundamentals, Valuation, Dividend Policy, Offer Information,
Regulatory & Statutory Disclosures, etc.
With a new IPO launch you get access to quality stocks, it is transparent by that we mean you will find all the relevant
information of the new IPO stocks from financial information to the pricing of its share, the company lays out everything
to lure the new investors.
How to apply for an IPO?
To begin investing in IPO one must open demat account online with a trusted broker. It is with this online demat account that
one can begin bidding for the shares that are registered online aka officially apply for new IPO stocks online.
The new IPO companies determine the share volume that each investor will be allocated. The IPO issue begins to allocate the shares to the interested investors who have bid for the shares.
SEBI, Securities and Exchange Board of India, defines the allocation of the IPO. The allotment is reserved by different investor category wise name, qualified institutional buyers,
non-institutional buyers and retail investors.
Note: Not all the bidders will qualify to receive the IPO. Many a times the quota of shares reserved for retail investors gets oversubscribed too.
Returns on IPO?
Potential Returns from an IPO depends on the subscription and Institutional Participation including Market Sentiments at the time of Listing.
Let’s take the example of DMart, their new IPO launch issue price in 2017 was approx. Rs. 299 per share, now their share price is Rs 2,850.
If one had picked up the company’s share, they would have bagged a good amount of wealth.
Usually, companies with a solid track attract a lot of interest among investors.
Platforms like LKP offer expertise on how to plan your personal investment and grow smartly, they offer service for investors to apply for IPO’s,
provide upcoming IPO list, latest IPO news, details about upcoming IPO dates and new IPO companies.
Additionally, LKP also offer a consolidated portfolio reports, trading platforms, research and advisory, portfolio management, and much more.