![]() ![]() No worries for refund as the money remains in investor's account. Just write the bank account number and sign in the application form to authorise your bank to make payment in case of allotment. Keep a check on the latest news about the company, it will give you an idea about any red flags, its growth and expansion plans, product and competitive landscape and economic factors affecting its business.ġ.No need to issue cheques by investors while subscribing to IPO. A few ratios like price to earning ratio, debt equity ratio, return on equity in comparison with peers will help you in assessing the risk and financial health. A basic overview of these numbers will give you a glimpse into the company's past performance and future prospects. You can understand the financial health of the company from its revenue, profits, debt, cash reserves over a period. Apart from the company’s business, prospectus will help you understand the overall industry and competitive landscape, global factors and general economy.Ī DRHP contains financial statements of the company for the last few years. This is a detailed document that contains all the important information about the company’s business, vision, products, markets, competition, future prospects, plans, promoters, key personnel, strengths and risks. SEBI mandates every IPO bound company to file a Draft Red Herring Prospectus (DRHP). As an investor, you must know how your money will be deployed. ![]() Companies may raise funds to fund their expansion and growth or pay off debt. Understand the objective of the IPO, what is the purpose for raising funds. Assess your goals, asset allocation and time horizon and ability to take risks. Investors must be willing to stay invested, bear the market fluctuations and stomach the risk to capital. Equity investments come with a volatility risk over the short term. However, one must consider a few factors before investing in any IPO:īefore investing in an IPO or equity markets, you must understand your financial goals and risk tolerance. Ans: IPOs present an opportunity for investors to participate in a company’s growth story. ![]()
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