What is IPO.

              What is IPO - INITIAL PUBLIC OFFERING?

IPO

Today in this article we will know what is IPO - Initial Public Offering? Why is IPO - Initial Public Offering required? What are the benefits of IPO - Initial Public Offering? And you will also know -IPO - What is the PROCESS of Initial Public Offering?

If you also have some such questions related to IPO - Initial Public Offering, then you keep reading this ARTICLE.

                            The full form of IPO is - Initial Public Offering

When a company decides to require its capital, it will fulfill its capital requirement by selling its company's share to the general public.

So for this, that company has to bring its offer to sell shares to the general public, fulfilling the terms and conditions made by SEBI to sell its share logo, the same offer as IPO i.e. Initial Public Offering or Called PUBLIC ISSUE.

You can understand IPO in easy language in this way -

 IPO is the first time a company offers to buy shares to PUBLIC for the first time"

 A Public Limited Company FUND collects FUND from general public through IPO"

"IPO is the PROCESS by which a Public Limited Company lists itself on the stock market for the first time.

The IPO is a PROCESS whereby the company proposes to solicit additional capital as part of its requirement, to the general public, in exchange for giving shares in its company.

IPO is the PROCESS for the sale of shares directly by the company through a PRIMARY MARKET.

Through the IPO we apply to buy shares from the DIRECT COMPANY, and once the application is approved, we are directly credited to our DEMAT ACCOUNT from the company.

Initial Public Offering

Why is IPO - INITIAL PUBLIC OFFERING needed?

When a company wants to grow its BUSINESS on a large scale, it needs a huge amount of capital, and in such a situation the company can have many different sources to get the capital, such as -

1. Company from the sources available with it (By Internal Sources of company)

2. Private Equity Sources,

3. Taking a loan from the bank

4. through Bond or Debenture,

5. ALLOT YOUR PUBLIC IN SHARE TO YOUR AUTHORIZED CAPITAL THROUGH IPO.

In this way the company can also have many other sources from which it can collect FUND to meet its capital requirement, but the FUND from all the SOURCES except IPO is like a LOAN over the company, which is pressurized to pay REGULAR interest and return the capital, whereas the company does not have to pay any interest if the IPO receives FUND from the people by selling its shares, nor is there any pressure to return the FUND from the shares, and the other company should get as much FUND as it needs. EQUITY can acquire CAPITAL by selling shares,

That is why the company prefers to bring an IPO for its largest capital requirement, although the thing to keep in mind is that to get an IPO, the company has to fulfill all the terms and conditions made by SEBI.

What are the benefits of IPO - INITIAL PUBLIC OFFERING?

As far as the benefits of IPO are concerned, the biggest benefit to the company by bringing an IPO is that the company gets the SHARE CAPITAL from the primary market as per its requirement, and without any interest and FUND RETURN. BUSINESS can do its job free of pressure, and people who buy shares from IPO have the advantage that through IPO, PUBLIC i.e. an investor can buy the shares of that company in a fixed PRICE RANGE, and can become the shareholder of that company, and in FUTURE When the stock price of that company increases, one can sell the shares to someone else through the stock market.