IPO Data

What Is IPO?

An initial public offering (IPO) or stock launch is a public offering in which shares of a company are sold to institutional investors and usually also retail (individual) investors.

An IPO is typically underwritten by one or more investment banks, who also arrange for the shares to be listed on one or more stock exchanges. Through this process, colloquially known as floating, or going public, a privately held company is transformed into a public company.

Initial public offerings can be used to raise new equity capital for companies, to monetize the investments of private shareholders such as company founders or private equity investors, and to enable easy trading of existing holdings or future capital raising by becoming publicly traded.

The initial public offering (IPO) process will take at least six months to complete. However, the maximum period of time can range from 9 months to a year. So, on average, it takes six to a year to finish the entire process of going public.

What Is Price Band?

A price band is a value-setting method in which a seller indicates an upper and lower cost limit, between which buyers are able to place bids. The price band’s floor and cap provide guidance to the buyers. This type of auction pricing technique is often used with initial public offerings (IPOs).

The price band is used during the price discovery stage of an initial public offering (IPO). When a company decides to issue shares in the primary market, it hires the services of one or more investment bankers to act as underwriters.

What Is GMP?

Grey market premium (GPM) is a premium amount at which grey market IPO shares are traded before they get listed in the stock exchange. In simple words, the stock of the company that came up with the IPO bought and sold outside the stock market.

IPO Investor Categories

• Qualified Institutional Buyers (QIB): Financial Institutions, Banks, FIIs, and Mutual Funds registered with SEBI are called QIBs. In most cases, QIBs represent small investors who invest through mutual funds, ULIP schemes of insurance companies, and pension schemes.
• Non-Institutional Investors(NII): Individual investors, NRIs, companies, trusts, etc who bid for more than Rs 2 lakhs are known as Non-institutional bidders or NII. They need not register with SEBI like QIIs.
• Retail Individual Investors(RII): The retail individual investor or NRIs who apply up to Rs 2,00,000 in an IPO are considered as RII reserved category.
• Employee (EMP): A category of eligible employees who have a reserved quota in the IPO.
• Others: A category of eligible shareholders or other investors who have a reserved quota in the IPO.