What Is IPO In Share Market
Initial Public Offering(IPO)
What Is IPO:
IPO means is initial public offering and that is offered by a unlisted company to the public means to all investors to raise fund. then when company get listed it becomes start trading in stock market.
Purpose Of IPO :
When private limited company wants to raise fund or need money called as capital to their business then company offers there share to be sold in market to the all investors and after that company becomes Public limited from private. This means every one can buy company stock after that. This is first time after listing at exchange for company so it is called initial offering. company also can offer ipo in the future.
What Needs To Invest In IPO
In your investing account in the details option you will find it ( this is different for every investing account so check it ). Where you can see all the incoming IPOs list or your broker Will tell you through emails or App notifications to alert you about it time to time.
You can directly go there and fill the required things like account, Lot size and you can apply for any company ipo when it starts. when it will approve your request you will get the filled lots of ipo .
Lot means here you cant buy one stock like in equity or cash markets there is minimum limit to buy shares in IPO and that all total quantity calls one lot. Like for example 13-15 equity shares in one lot. Lot quantity is different for each company ipo.
How Much Minimum Amount Need To Buy IPO
You need minimum one lot size amount for example in India you need 13 - 17 thousand rs minimum to buy ipo this is not fixed may be less or more but you need enough money to buy. This is calculated by offered price band price multiply by quantity of lot.
Below basic things are explained
Examples Of Ipo :
1. Zomato IPO
- Issuer size : 9375 cr (total)
- Face value : Rs. 1 per equity share
- Bid lot : 195 equity share and in multiples thereafter.
- Price band : 72 - 76 rs
2. Tatva Chintan Pharma Chem Ltd
- Issue size:500 Cr
- Face value : Rs 10 per equity share
- Price band : 1073 - 1083
- Bid lot : 13 equity share and in multiples thereafter.
Issue size means total amount of offered shares in market.
Face value means original value of stock less than offer price , to written on contract paper only.
Price band means you will get share between that offered price.
Bid lots means you can only buy Minimum 13 share and it is called one lot and in multiples of it like 26, 39 or 3 Lots.
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