Initial public offering IPO is a process of enlisting your company in the stock market for the issue of shares to the investor,
for a considerable amount to attain capital for expanding the business. Important Benefits of investing in IPO in India,
as the company entered the stock market for the first time it has passed certain criteria,
so that means it is the company that has performed well in the past and assumed to do the same in the future with additional capital.
There are many reasons why to invest and especially when it comes to IPO there are a few reasons mentioned below:
Cost of investment:
Since the company is coming into the stock market for the first time usually the price band of the stock is lower,
considerably cheaper than the price of any exiting company.
The ratio for the success to the IPO released in India is 1:4 which means 10 out of 8 companies provide us with the higher success ratio up to 120%.
Higher compared to any of the existing companies.
Long term goals:
As IPO trades in equity shares holding on to those will yield a definite highest return because the price of the share at the time of IPO is very low,
so by the time, it turns into a fully functioning stock the price of the stock will definitely be higher.
Wealth maximization refers to the profit by the holding in our account, profit is the return of investment
wherein wealth refers to the increase in the value of the stock you have invested in.
Ex: A bought 10 shares in XYZ company at 10rs each after a long time the value of stock becomes 100rs per stock.
The value of the stock increased is known as wealth maximization.
Below is the chart of IPOs issued in the year 2020 and their variation after the issue in the market.
Well, we have covered the topic of IPO: Important Benefits of investing in IPO in India well after entering into the stock/share market all the activities will be regulated by the Security Exchange Board Of India(SEBI) who is the governing body for all the companies that enter into the stock market, well whatever the reason it may be but there is always a growth factor that will be given boosting the companies performances and will certainly elevate the companies status and bring the trust to investors of the company.
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