What Is an IPO and How Does It Work?
An IPO, or Initial Public Offering, is the first time a private company sells shares to the public. It allows companies to raise capital and gives investors a chance to buy shares early.
How IPO Works
- Company files IPO documents with regulators
- Price band or share price is determined
- Shares are offered to investors via brokers
- IPO shares get listed on stock exchanges for trading
Benefits of IPOs
- Access to potentially high-growth companies
- First opportunity for public investors
- Companies raise funds for expansion
Conclusion
IPOs are an important way for companies to go public and for investors to participate in early growth opportunities in both US and Indian markets.
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