IPO (Initial Public Offerings)
May be some of us are here new to this Initial Public Issue (IPO) thing. Here is a brief of how to start in IPO and earn money from IPOs:
Important points to keep in mind before investing in IPOs
- Check the price band of IPO and any sort of overpricing should be clearly avoided.
- Quality IPO’s will always give better return, so stick with the Quality and reputed names.
- Check Offer for Sale (OFS), we have seen many promoters/Anchor Investors taking exits through IPO route, this should be checked.
- Quality and ability of management of company should be checked before investment, these days markets are very cautious and aggressive towards corporate governance issues.
- Have a look at peer companies and sector benchmarks, if valuation is higher than industry then take a pause and think before investing.
In the end just a suggestion not to follow the crowd and make investments in a systematic manner, Success is more about discipline than skills. Do your own diligence and study before investing in IPO’s