Business & Finance Stocks-Mutual-Funds

IPO Listing Process in India

Do you know what "Initial Public Offer" is or have you heard of the term IPO? This is the process of listing a particular company in Indian Stock exchanges.
You can learn more on the listing process in this article.
There are two main stock exchanges in India.
They are: BSE-Bombay Stock Exchange NSE-National Stock Exchange A company would be interested to raise funds for their business expansion and other purposes.
They go for an Initial Public offer through which they offload their shares and raise money from the public.
This process is called an Initial Public Offer.
IPO Listing Process:
  • A company initially files for DRHP - Draft Red Herring prospectus with the SEBI (Stock Exchange Board of India).
  • The company appoints investment bankers who would manage the IPO and raise funds.
    They evaluate the balance sheet and the assets maintained by the company and study the current valuations of the company.
  • Once they evaluate the valuations, they fix the price band for the IPO which would be fixed in comparison with the peers that are currently listed in the exchanges.
    If the price is fixed in line with its peers, then the subscription chances for the IPO would be high.
  • Then the issue will start on the corresponding issue date.
    The investors can apply for the IPO on the corresponding dates.
  • After the subscription closes, the stocks will be allotted to the applicants based on the subscription status.
    This will take a time of two to three weeks after which the company lists in the exchanges.

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