IPO stands for Initial Public Offering. An initial public offering is when a private company or corporation raises equity capital by offering its stock to the public for the first time. It could be a new, young company or an old company which decides to be listed (to become publicly traded) on an exchange and hence goes public.

What is Rights Issue?

A rights issue is a way by which a listed company can raise additional capital. However, instead of going to the public, the company gives its existing shareholders the right to subscribe to newly issued shares in proportion to their existing holdings.

FPO stands for Follow on Public Offer. If even after Rights Issue, the company couldn’t raise the capital or still has more capital requirement then the company can use the FPO source to raise funds.

There are 3 key reasons why companies take out an IPO or Initial Public Offering - 1) Raise Capital for the Business, 2) Liquidity for Private Equity Investors, 3) Liquidity for Employees, 4) Currency for Merger & Acquisition, 5) Branding and Visibility

Stock Market Concepts Archives - Yadnya Investment Academy

5 min read

Why Do Companies Pay Dividends?

2 weeks ago

3 Scenarios - Why Do Companies Pay Dividends? Introduction Why do Companies pay dividends to the shareholders? Whereas why some...

4 min read

All About Differential Voting Rights (DVR) Shares

2 weeks ago

Differential Voting Rights - Tata Motors vs Tata Motors DVR Introduction What are Differential Voting Rights (DVR) Shares? What is...

6 min read

Profit Booking Strategies Explained

2 weeks ago

What is Profit Booking or Profit Taking? Introduction Caught in the daily twists and turns of the stock market? Here...

4 min read

Consolidated vs Standalone Financials | Which One To Consider?

2 weeks ago

Solving The Consolidated vs Standalone Financials Dilemma Introduction What is the difference between Consolidated vs Standalone Financials? Which one should...