What is the Full Form of IPO? A Beginner’s Guide to Initial Public

The stock market is an appealing space with numerous opportunities. One such opportunity for investors is to invest in IPOs. Initial public offerings (IPOs) refer to a process where private companies list their stocks on the stock exchange for the first time. 

IPOs in India are widely popular as they offer the potential of capitalizing on the market opportunities. Those interested in IPOs must first understand the fundamentals, workings, and ways to invest in IPOs. Keep reading as we discuss everything you need to know about IPOs, as beginners.

IPO Full Form and Meaning

IPO stands for Initial Public Offerings, where a private company lists its shares on the stock exchange for the first time for investors to put their money in. 

IPOs are offered by a private company mainly to raise funds for the company’s growth and expansion projects. Thus, by issuing a stake in the company to investors, the company raises capital.

IPOs are often regarded as two-headed swords as they benefit the company by helping it raise capital, and investors benefit from promising opportunity and owning a stake in reputed companies. 

There are two kinds of IPOs for investors:

• Fixed Price Offering: As the name suggests, this type of IPO has its price fixed before being opened for subscription. Investors have to apply for a subscription based on this price.
• Book Building Offering: This type of IPO doesn’t have its prices fixed. Rather, the price depends on the investor's interest. Here, a price band is provided featuring floor price (minimum price) and cap price (highest price). Investors put a bid between the given price range, and depending on the bids, the final price is decided.

IPO for Beginners: All You Need to Know

Investing in an IPO is a simple process, however, unlike other stocks, the process is slightly different. Here’s how you can invest in an IPO online using Bajaj Broking website or Bajaj Broking Trading App:

• Step 1: Login to your Bajaj Broking trading account
• Step 2: Choose ‘IPO’ from the menu
• Step 3: See ‘Open IPOs’ and tap/click on ‘Apply’
• Step 4: Enter the quantity (lot)
• Step 5: Enter your UPI ID to block the requisite amount
• Step 6: Submit your IPO application

Summing Up

Investing in IPOs can promise impressive opportunities if done with due diligence. As a beginner, before you decide to put your money in, make sure to research the company well, understand the market condition for stocks you are interested in, and always start small. At Bajaj Broking, investing in IPOs becomes easier as you have access to an updated list of IPOs, swift application through UPI and an overall seamless application experience. 

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