{"id":9825,"date":"2023-01-18T13:03:26","date_gmt":"2023-01-18T07:33:26","guid":{"rendered":"https:\/\/www.tickertape.in\/glossary\/?p=9825"},"modified":"2023-02-01T16:52:25","modified_gmt":"2023-02-01T11:22:25","slug":"ipo-meaning-working-pros-and-cons","status":"publish","type":"post","link":"https:\/\/www.tickertape.in\/glossary\/ipo-meaning-working-pros-and-cons\/","title":{"rendered":"IPO: Meaning, Working, Pros and Cons"},"content":{"rendered":"\n<p>IPOs (Initial Public Offering) are a rage in today&#8217;s investing world. The year 2022 saw some major IPOs, with LIC topping the<em> buzz charts<\/em>. More than 60 companies went public in 2021, raising trillions. The trend is only expected to grow further. But what are IPOs?<\/p>\n\n\n\n<p>In an IPO, a private company becomes a public company by raising <a href=\"https:\/\/www.tickertape.in\/glossary\/what-is-capital-definition-of-capital-types-and-its-importance\/\">capital<\/a> from the public. Let&#8217;s understand the basics of an IPO and how it works.&nbsp;<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_22 counter-hierarchy counter-numeric\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\">You will Learn About: <\/p>\n<span class=\"ez-toc-title-toggle\"><a class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" style=\"display: none;\"><i class=\"ez-toc-glyphicon ez-toc-icon-toggle\"><\/i><\/a><\/span><\/div>\n<nav><ul class=\"ez-toc-list ez-toc-list-level-1\"><li class=\"ez-toc-page-1 ez-toc-heading-level-2\"><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.tickertape.in\/glossary\/ipo-meaning-working-pros-and-cons\/#IPO-meaning\" title=\"IPO meaning\">IPO meaning<\/a><\/li><li class=\"ez-toc-page-1 ez-toc-heading-level-2\"><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.tickertape.in\/glossary\/ipo-meaning-working-pros-and-cons\/#IPO-Key-Points-to-Remember\" title=\"IPO: Key Points to Remember \">IPO: Key Points to Remember <\/a><\/li><li class=\"ez-toc-page-1 ez-toc-heading-level-2\"><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.tickertape.in\/glossary\/ipo-meaning-working-pros-and-cons\/#How-does-an-initial-public-offering-work\" title=\"How does an initial public offering work?\">How does an initial public offering work?<\/a><\/li><li class=\"ez-toc-page-1 ez-toc-heading-level-2\"><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/www.tickertape.in\/glossary\/ipo-meaning-working-pros-and-cons\/#The-history-of-IPOs\" title=\"The history of IPOs\">The history of IPOs<\/a><\/li><li class=\"ez-toc-page-1 ez-toc-heading-level-2\"><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/www.tickertape.in\/glossary\/ipo-meaning-working-pros-and-cons\/#Steps-to-an-IPO\" title=\"Steps to an IPO\">Steps to an IPO<\/a><\/li><li class=\"ez-toc-page-1 ez-toc-heading-level-2\"><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/www.tickertape.in\/glossary\/ipo-meaning-working-pros-and-cons\/#Advantages-and-disadvantages-of-an-IPO\" title=\"Advantages and disadvantages of an IPO\">Advantages and disadvantages of an IPO<\/a><\/li><li class=\"ez-toc-page-1 ez-toc-heading-level-2\"><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/www.tickertape.in\/glossary\/ipo-meaning-working-pros-and-cons\/#Key-terms-in-IPO\" title=\"Key terms in IPO\">Key terms in IPO<\/a><\/li><li class=\"ez-toc-page-1 ez-toc-heading-level-2\"><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/www.tickertape.in\/glossary\/ipo-meaning-working-pros-and-cons\/#What-is-the-difference-between-IPO-and-share\" title=\"What is the difference between IPO and share?\">What is the difference between IPO and share?<\/a><\/li><li class=\"ez-toc-page-1 ez-toc-heading-level-2\"><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/www.tickertape.in\/glossary\/ipo-meaning-working-pros-and-cons\/#Conclusion\" title=\"Conclusion\">Conclusion<\/a><\/li><li class=\"ez-toc-page-1 ez-toc-heading-level-2\"><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/www.tickertape.in\/glossary\/ipo-meaning-working-pros-and-cons\/#FAQs\" title=\"FAQs\">FAQs<\/a><\/li><\/ul><\/nav><\/div>\n<h2><span class=\"ez-toc-section\" id=\"IPO-meaning\"><\/span><strong>IPO meaning<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>In an IPO, a private company floats its shares to the public for the first time to raise money and list them on the <a href=\"https:\/\/www.tickertape.in\/glossary\/stock\/\">stock<\/a> exchange.&nbsp;<\/p>\n\n\n\n<p>Companies use an IPO to acquire fresh capital, which can be used for different purposes like research and product development, improving distribution channels, expansion, acquisition and even debt settlement.<\/p>\n\n\n\n<div class=\"wp-block-uagb-advanced-heading uagb-block-70a0bbd8\"><h2 class=\"uagb-heading-text\"><span class=\"ez-toc-section\" id=\"IPO-Key-Points-to-Remember\"><\/span>IPO: Key Points to Remember <span class=\"ez-toc-section-end\"><\/span><\/h2><\/div>\n\n\n\n<ul>\n<li>An IPO<strong> <\/strong>allows a private company to become public by issuing shares through a stock exchange.<\/li>\n\n\n\n<li>The company submits key documents related to its earnings to the Securities and Exchange Board of India (SEBI) before the IPO is announced.<\/li>\n\n\n\n<li>Once the company is listed on the stock exchange, its shares can be traded in the share market.<\/li>\n<\/ul>\n\n\n\n<h2><span class=\"ez-toc-section\" id=\"How-does-an-initial-public-offering-work\"><\/span><strong>How does an initial public offering work?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>A company must follow a standard set of protocols and procedures if it wishes to go public.&nbsp;&nbsp;<\/p>\n\n\n\n<p>The company must first engage an underwriter or an <a href=\"https:\/\/www.tickertape.in\/glossary\/investment-meaning-types-how-to-invest-and-savings-vs-investments\/\">investment<\/a> bank for a value assessment. Based on the assessment, the company can decide the price band and the number of shares to issue to the public.&nbsp;<\/p>\n\n\n\n<p>The underwriter then sends an application to <a href=\"https:\/\/www.tickertape.in\/blog\/securities-and-exchange-board-of-india-functions-powers-and-regulations-of-sebi\/\">SEBI<\/a> to verify all the information. SEBI directs the company to release a Draft Red Herring Prospectus (DRHP). The prospectus contains all the details about the company, its financials etc., that are important for the investors.<\/p>\n\n\n\n<h2><span class=\"ez-toc-section\" id=\"The-history-of-IPOs\"><\/span><strong>The history of <\/strong><strong>IPO<\/strong><strong>s<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The practice of conducting the IPOs began in the Netherlands when the Dutch East India Company offered its shares to the general public in 1602. Since then, several companies worldwide have used IPOs to raise capital and pursue growth.&nbsp;<\/p>\n\n\n\n<p>Reliance Industries Limited was the first Indian company to launch its IPO in 1977. The company had issued 2.8 mn equity shares valued at Rs. 10 each.&nbsp;<\/p>\n\n\n\n<h2><span class=\"ez-toc-section\" id=\"Steps-to-an-IPO\"><\/span><strong>Steps to an <\/strong><strong>IPO<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>An<strong> IPO<\/strong> is a lengthy process involving several steps. Some of these steps include<\/p>\n\n\n\n<ol>\n<li><strong>Proposals:<\/strong> Several underwriters and investment firms submit their proposals to the company.<\/li>\n\n\n\n<li><strong>Choice:<\/strong> Once the private company goes through all the proposals, it decides on the underwriter and gets into an underwriting agreement.&nbsp;<\/li>\n\n\n\n<li><strong>Formation of an <\/strong><strong>IPO <\/strong><strong>team:<\/strong> The team consists of underwriters, Chartered Accountants (CAs), finance associates, etc.<\/li>\n\n\n\n<li><strong>Documentation: <\/strong>The application is drafted, which includes financial statements, growth strategy, net worth, etc.&nbsp;<\/li>\n\n\n\n<li><strong>Marketing: <\/strong>The company releases material to generate positive headlines and demand. The shares are marketed to the public, and once underwriters gauge demand, they can change the company&#8217;s valuation along with the share prices.<\/li>\n\n\n\n<li><strong>Verification:<\/strong> SEBI goes through all the documents to ensure that all the eligibility norms are being adhered to.&nbsp;<\/li>\n\n\n\n<li><strong>Draft Red Herring Prospectus (DRHP): <\/strong>Once SEBI approves the documents, it directs the company to release its DRHP. The prospectus states the number and price of each share that will be offered through the<strong> <\/strong>IPO.<\/li>\n\n\n\n<li><strong>The IPO:<\/strong> The IPO opens for a 5-6 day bidding window during which investors are allowed to bid<\/li>\n\n\n\n<li><strong>Allotment: <\/strong>Investors, based on a lottery system, are allocated shares, which are credited to their Demat accounts. Other investors receive a refund.&nbsp;<\/li>\n<\/ol>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-large\"><img decoding=\"async\" loading=\"lazy\" width=\"1024\" height=\"512\" src=\"https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/image-11-1024x512.png\" alt=\"\" class=\"wp-image-9837\" srcset=\"https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/image-11-1024x512.png 1024w, https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/image-11-300x150.png 300w, https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/image-11.png 1200w, https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/image-11-300x150@2x.png 600w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><figcaption class=\"wp-element-caption\">Image source: https:\/\/www.indiacharts.com\/<\/figcaption><\/figure><\/div>\n\n\n<h2><span class=\"ez-toc-section\" id=\"Advantages-and-disadvantages-of-an-IPO\"><\/span><strong>Advantages and disadvantages of an <\/strong><strong>IPO<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Investors find IPOs advantageous because they get the chance to buy shares before market forces have the opportunity to drive prices up. Many investors also feel like this is the point of maximum transparency &#8211; where institutional investors (investment banks etc.) and retail investors have access to the same amount of information.&nbsp;<\/p>\n\n\n\n<p>The disadvantages of investing in an IPO are the lack of historical stock price data and the chance that you might not receive the allocation you bid for.&nbsp;<\/p>\n\n\n\n<h2><span class=\"ez-toc-section\" id=\"Key-terms-in-IPO\"><\/span><strong>Key terms in <\/strong><strong>IPO<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>There are several terms that you might come across in an IPO discussion. Some of these terms include<\/p>\n\n\n\n<ol>\n<li><strong>Draft Red Herring Prospectus (DRHP)<\/strong>: This document contains all the information about the company that investors need to make a sound decision. It includes the company&#8217;s valuation, share price, strategy for utilisation of IPO proceeds and other key details.<\/li>\n\n\n\n<li><strong>Price band:<\/strong> This is the range within which the investors can bid for the shares. The band is decided mutually by the company and the underwriter.&nbsp;<\/li>\n\n\n\n<li><strong>Offer date: <\/strong>This is the date investors can apply to buy IPO shares.&nbsp;<\/li>\n\n\n\n<li><strong>Minimum subscription: <\/strong>This is the minimum amount the company must raise through their IPO, failing which all capital must be returned. In India, the minimum subscription rate is 90% of the issued share capital.&nbsp;<\/li>\n\n\n\n<li><strong>Issue price: <\/strong>The price at which the shares are allotted to the investors is called the issue price.&nbsp;<\/li>\n\n\n\n<li><strong>Oversubscription: <\/strong>This happens when the bids for shares exceed the number of shares floated in the primary market.<\/li>\n<\/ol>\n\n\n\n<h2><span class=\"ez-toc-section\" id=\"What-is-the-difference-between-IPO-and-share\"><\/span><strong>What is the difference between IPO and share?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Let\u2019s check the differences between an IPO and a share:<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td><strong>IPO<\/strong><\/td><td><strong>Share<\/strong><\/td><\/tr><tr><td>IPO is the process by which a company goes public<\/td><td>A share is a portion of ownership in a public company<\/td><\/tr><tr><td>The price may be fixed, or there might be a price range<\/td><td>The market decides the price<\/td><\/tr><tr><td>Investor may or may not receive shares bid for<\/td><td>Investor get shares provided they are willing to pay the price&nbsp;<\/td><\/tr><tr><td>Past share price is not available&nbsp;<\/td><td>Investors can access the past share price&nbsp;<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p>To find the current price of the stock, use <a href=\"https:\/\/www.tickertape.in\/stocks\/nestle-india-NEST\">Tickertape&#8217;s Stock Pages<\/a>. Not just the stock price, you can also get several other details about a company like its 1-yr returns, 5-yr CAGR, financials, market cap, with other key metrics. And most importantly, there is a Scorecard which can determine the performance of a stock. <\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" loading=\"lazy\" width=\"1024\" height=\"508\" src=\"https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/Screenshot-2023-01-18-at-12.52.59-PM-1024x508.png\" alt=\"\" class=\"wp-image-9831\" srcset=\"https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/Screenshot-2023-01-18-at-12.52.59-PM-1024x508.png 1024w, https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/Screenshot-2023-01-18-at-12.52.59-PM-300x149.png 300w, https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/Screenshot-2023-01-18-at-12.52.59-PM-1536x762.png 1536w, https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/Screenshot-2023-01-18-at-12.52.59-PM-1024x508@2x.png 2048w, https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/Screenshot-2023-01-18-at-12.52.59-PM-300x149@2x.png 600w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<h2><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span><strong>Conclusion<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>An IPO plays a major role in the transition from a private company to a public company. If a company wants to raise capital from the general public and get listed on the stock exchange, it launches an IPO. Once the IPO is announced open, investors can bid for the shares. But, remember, stocks carry high risk. Consult your advisor before applying for an IPO.&nbsp;<\/p>\n\n\n\n<h2><span class=\"ez-toc-section\" id=\"FAQs\"><\/span><strong>FAQs<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<div class=\"wp-block-uagb-faq uagb-faq__outer-wrap uagb-block-99911e32 uagb-faq-icon-row uagb-faq-layout-accordion uagb-faq-expand-first-true uagb-faq-inactive-other-true uagb-faq__wrap uagb-buttons-layout-wrap uagb-faq-equal-height\" data-faqtoggle=\"true\" role=\"tablist\">\n<div class=\"wp-block-uagb-faq-child uagb-faq-child__outer-wrap uagb-faq-item uagb-block-0a64cb89\" role=\"tab\" tabindex=\"0\"><div class=\"uagb-faq-questions-button uagb-faq-questions\"><span class=\"uagb-icon uagb-faq-icon-wrap\"><svg xmlns=\"https:\/\/www.w3.org\/2000\/svg\" viewBox=\"0 0 448 512\"><path d=\"M432 256c0 17.69-14.33 32.01-32 32.01H256v144c0 17.69-14.33 31.99-32 31.99s-32-14.3-32-31.99v-144H48c-17.67 0-32-14.32-32-32.01s14.33-31.99 32-31.99H192v-144c0-17.69 14.33-32.01 32-32.01s32 14.32 32 32.01v144h144C417.7 224 432 238.3 432 256z\"><\/path><\/svg><\/span><span class=\"uagb-icon-active uagb-faq-icon-wrap\"><svg xmlns=\"https:\/\/www.w3.org\/2000\/svg\" viewBox=\"0 0 448 512\"><path d=\"M400 288h-352c-17.69 0-32-14.32-32-32.01s14.31-31.99 32-31.99h352c17.69 0 32 14.3 32 31.99S417.7 288 400 288z\"><\/path><\/svg><\/span><span class=\"uagb-question\"><strong>What is NII in IPO?<\/strong><\/span><\/div><p class=\"uagb-faq-content\">Non-institutional bidders, or NII, when concerning an IPO, are those individuals that bid more than Rs. 2 lakh shares. NRIs, HNIs, corporate bodies, trusts, HUFs etc., also who bid more than Rs. 2 lakh fall under the NII category.\u00a0<\/p><\/div>\n\n\n\n<div class=\"wp-block-uagb-faq-child uagb-faq-child__outer-wrap uagb-faq-item uagb-block-509dfdef\" role=\"tab\" tabindex=\"0\"><div class=\"uagb-faq-questions-button uagb-faq-questions\"><span class=\"uagb-icon uagb-faq-icon-wrap\"><svg xmlns=\"https:\/\/www.w3.org\/2000\/svg\" viewBox=\"0 0 448 512\"><path d=\"M432 256c0 17.69-14.33 32.01-32 32.01H256v144c0 17.69-14.33 31.99-32 31.99s-32-14.3-32-31.99v-144H48c-17.67 0-32-14.32-32-32.01s14.33-31.99 32-31.99H192v-144c0-17.69 14.33-32.01 32-32.01s32 14.32 32 32.01v144h144C417.7 224 432 238.3 432 256z\"><\/path><\/svg><\/span><span class=\"uagb-icon-active uagb-faq-icon-wrap\"><svg xmlns=\"https:\/\/www.w3.org\/2000\/svg\" viewBox=\"0 0 448 512\"><path d=\"M400 288h-352c-17.69 0-32-14.32-32-32.01s14.31-31.99 32-31.99h352c17.69 0 32 14.3 32 31.99S417.7 288 400 288z\"><\/path><\/svg><\/span><span class=\"uagb-question\"><strong>What is the grey market premium in IPO?<\/strong><\/span><\/div><p class=\"uagb-faq-content\">A grey market premium can be defined as the amount by which the price of a newly listed stock in the grey market (a market for trading stocks that are not listed on formal exchanges) exceeds the IPO price. This premium can give an insight into the investors\u2019 interest and demand for the concerned IPO.\u00a0<\/p><\/div>\n\n\n\n<div class=\"wp-block-uagb-faq-child uagb-faq-child__outer-wrap uagb-faq-item uagb-block-b6396a3c\" role=\"tab\" tabindex=\"0\"><div class=\"uagb-faq-questions-button uagb-faq-questions\"><span class=\"uagb-icon uagb-faq-icon-wrap\"><svg xmlns=\"https:\/\/www.w3.org\/2000\/svg\" viewBox=\"0 0 448 512\"><path d=\"M432 256c0 17.69-14.33 32.01-32 32.01H256v144c0 17.69-14.33 31.99-32 31.99s-32-14.3-32-31.99v-144H48c-17.67 0-32-14.32-32-32.01s14.33-31.99 32-31.99H192v-144c0-17.69 14.33-32.01 32-32.01s32 14.32 32 32.01v144h144C417.7 224 432 238.3 432 256z\"><\/path><\/svg><\/span><span class=\"uagb-icon-active uagb-faq-icon-wrap\"><svg xmlns=\"https:\/\/www.w3.org\/2000\/svg\" viewBox=\"0 0 448 512\"><path d=\"M400 288h-352c-17.69 0-32-14.32-32-32.01s14.31-31.99 32-31.99h352c17.69 0 32 14.3 32 31.99S417.7 288 400 288z\"><\/path><\/svg><\/span><span class=\"uagb-question\"><strong>What is SME IPO?<\/strong><\/span><\/div><p class=\"uagb-faq-content\">SME IPO, or small and medium-sized enterprises&#8217; initial public offering, is the process through which small and medium-sized companies raise capital by selling stakes\/shares to the general public for the first time. Companies with minimum post-issue capital of Re. 1 crore and a maximum of Rs. 25 cr. are eligible for SME IPO in India.\u00a0<\/p><\/div>\n\n\n\n<div class=\"wp-block-uagb-faq-child uagb-faq-child__outer-wrap uagb-faq-item uagb-block-d64ab27d\" role=\"tab\" tabindex=\"0\"><div class=\"uagb-faq-questions-button uagb-faq-questions\"><span class=\"uagb-icon uagb-faq-icon-wrap\"><svg xmlns=\"https:\/\/www.w3.org\/2000\/svg\" viewBox=\"0 0 448 512\"><path d=\"M432 256c0 17.69-14.33 32.01-32 32.01H256v144c0 17.69-14.33 31.99-32 31.99s-32-14.3-32-31.99v-144H48c-17.67 0-32-14.32-32-32.01s14.33-31.99 32-31.99H192v-144c0-17.69 14.33-32.01 32-32.01s32 14.32 32 32.01v144h144C417.7 224 432 238.3 432 256z\"><\/path><\/svg><\/span><span class=\"uagb-icon-active uagb-faq-icon-wrap\"><svg xmlns=\"https:\/\/www.w3.org\/2000\/svg\" viewBox=\"0 0 448 512\"><path d=\"M400 288h-352c-17.69 0-32-14.32-32-32.01s14.31-31.99 32-31.99h352c17.69 0 32 14.3 32 31.99S417.7 288 400 288z\"><\/path><\/svg><\/span><span class=\"uagb-question\"><strong>How to check IPO status?\u00a0<\/strong><\/span><\/div><p class=\"uagb-faq-content\">IPO status check can be easily done online, through your brokerage, or offline, by visiting your bank.\u00a0<\/p><\/div>\n\n\n\n<div class=\"wp-block-uagb-faq-child uagb-faq-child__outer-wrap uagb-faq-item uagb-block-03b47bbc\" role=\"tab\" tabindex=\"0\"><div class=\"uagb-faq-questions-button uagb-faq-questions\"><span class=\"uagb-icon uagb-faq-icon-wrap\"><svg xmlns=\"https:\/\/www.w3.org\/2000\/svg\" viewBox=\"0 0 448 512\"><path d=\"M432 256c0 17.69-14.33 32.01-32 32.01H256v144c0 17.69-14.33 31.99-32 31.99s-32-14.3-32-31.99v-144H48c-17.67 0-32-14.32-32-32.01s14.33-31.99 32-31.99H192v-144c0-17.69 14.33-32.01 32-32.01s32 14.32 32 32.01v144h144C417.7 224 432 238.3 432 256z\"><\/path><\/svg><\/span><span class=\"uagb-icon-active uagb-faq-icon-wrap\"><svg xmlns=\"https:\/\/www.w3.org\/2000\/svg\" viewBox=\"0 0 448 512\"><path d=\"M400 288h-352c-17.69 0-32-14.32-32-32.01s14.31-31.99 32-31.99h352c17.69 0 32 14.3 32 31.99S417.7 288 400 288z\"><\/path><\/svg><\/span><span class=\"uagb-question\"><strong><strong>What is the job of an underwriter?<\/strong><\/strong><\/span><\/div><p class=\"uagb-faq-content\">An underwriter plays a very important role in the launch of an IPO. They determine the company&#8217;s value and submit all the necessary documents to SEBI.\u00a0<\/p><\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>In an IPO, a private company becomes a public company by raising capital from the public. Let&#8217;s understand the basics of an IPO and how it works.\u00a0<\/p>\n","protected":false},"author":96,"featured_media":9775,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"spay_email":""},"categories":[1],"tags":[1929],"jetpack_featured_media_url":"https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09.png","uagb_featured_image_src":{"full":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09.png",2086,1086,false],"thumbnail":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09-150x150.png",150,150,true],"medium":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09-300x156.png",300,156,true],"medium_large":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09.png",768,400,false],"large":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09-1024x533.png",770,401,true],"1536x1536":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09-1536x800.png",1536,800,true],"2048x2048":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09-2048x1066.png",2048,1066,true],"authorship-box-avatar":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09-150x150.png",150,150,true],"authorship-box-related":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09-70x70.png",70,70,true],"post-thumbnail":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09-270x180.png",270,180,true],"contentberg-main":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09-770x515.png",770,515,true],"contentberg-main-full":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09-1170x508.png",1170,508,true],"contentberg-slider-stylish":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09-900x515.png",900,515,true],"contentberg-slider-carousel":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09-370x370.png",370,370,true],"contentberg-slider-grid-b":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09-554x466.png",554,466,true],"contentberg-slider-grid-b-sm":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09-306x466.png",306,466,true],"contentberg-slider-bold-sm":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09-150x150.png",150,150,true],"contentberg-grid":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09-370x245.png",370,245,true],"contentberg-list":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09-260x200.png",260,200,true],"contentberg-list-b":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09-370x305.png",370,305,true],"contentberg-thumb":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09-87x67.png",87,67,true],"contentberg-thumb-alt":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/01\/09-150x150.png",150,150,true]},"uagb_author_info":{"display_name":"Nikitha","author_link":"%3Fmolongui_byline=true%26mca="},"uagb_comment_info":0,"uagb_excerpt":"In an IPO, a private company becomes a public company by raising capital from the public. Let's understand the basics of an IPO and how it works.\u00a0","_links":{"self":[{"href":"https:\/\/www.tickertape.in\/glossary\/wp-json\/wp\/v2\/posts\/9825"}],"collection":[{"href":"https:\/\/www.tickertape.in\/glossary\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.tickertape.in\/glossary\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.tickertape.in\/glossary\/wp-json\/wp\/v2\/users\/96"}],"replies":[{"embeddable":true,"href":"https:\/\/www.tickertape.in\/glossary\/wp-json\/wp\/v2\/comments?post=9825"}],"version-history":[{"count":3,"href":"https:\/\/www.tickertape.in\/glossary\/wp-json\/wp\/v2\/posts\/9825\/revisions"}],"predecessor-version":[{"id":9931,"href":"https:\/\/www.tickertape.in\/glossary\/wp-json\/wp\/v2\/posts\/9825\/revisions\/9931"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.tickertape.in\/glossary\/wp-json\/wp\/v2\/media\/9775"}],"wp:attachment":[{"href":"https:\/\/www.tickertape.in\/glossary\/wp-json\/wp\/v2\/media?parent=9825"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.tickertape.in\/glossary\/wp-json\/wp\/v2\/categories?post=9825"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.tickertape.in\/glossary\/wp-json\/wp\/v2\/tags?post=9825"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}