What is an Initial Public Offering (IPO)?
An IPO is the process by which a private company becomes public through the sale of a portion of its shares to the general public.
It is generally initiated to raise capital for the business or for existing shareholders to exit their investments. Investors can acquire shares by applying for an IPO, and after the allotment process, the company's shares are listed and traded on the stock exchanges.
For example, the food delivery giant, Zomato, went open for subscription in July 2021, issuing 9375 crore shares at a price band of Rs. 72-76 per share.
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