Do you know what an IPO is and how it works and do you know if it is good or bad to invest in companies with an IPO and Upcoming IPO List in 2021 India?
An Initial Public Offering is a process by which a private company can go public by the sale of its stocks to the general public. It can be a new or old company that decides to be listed on an exchange and hence goes public.
An IPO is generally initiated to fill the new equity capital to the firm, to raise capital for the future, to ease the trading of the existing assets, or monetize the investments made by the existing stakeholders.
With the help of investment banks, a company that offers its share is also known as the issuer. The company’s shares are traded in the open market after the IPO.
To hold an initial public offering the company must be required by exchanges and securities and exchange commission(SEC).
An IPO can also be seen as an exit strategy for early investors, and founders realizing the full profit from their first investment.
Types of IPO
The two types of IPO are
- Fixed Price Offering
- Book Building Offering
Fixed Price Offering
In a fixed price IPO process, the company along with their underwriters evaluate the companies assets, liabilities, and every financial aspect. Then they work on these figures and fix a price for their offerings.
The fixed per issue is therefore printed in a document. After considering all the quantitative and qualitative factors the price is fixed. The demand for stocks in the market can only be known once the price is issued. The investors partaking in this IPO must pay the full prices of shares when they make the application.
Book Building Offering
The concept of the Book Building offering is new to India compared to other developed countries. There is no fixed price but a price band or range in a Book building offering. The lowest and highest price band is referred to as ‘floor price‘ and ‘cap price‘.
The investors can bid for the desired quantity of shares they would like to pay and depending upon the bid the stock price is decided. The ultimate decision regarding the price of the shares is determined by the investor’s bids. The demand is known each day as the book is built.
How the initial public offering works
Before an IPO, a company is considered private. A private company needs capital that is way beyond its ability to generate through small business and there are very few options for management to work out within its capital.
The best methods to do so include public investment, taking debt, or private investment through an IPO.
When a firm hires an investment bank or banks to take care of an IPO it process gets started. It can be taxing for a company when it chooses to sell its shares on its own.
The bank hands over its bid to companies that go public on the money they earn and will make into IPO. An investment bank which process taking care of IPO is called underwriting.
Investment through an IPO
The company and investment bank talk about how much money they think they aim to raise from the IPO when the investment bank is hired to do the role then it’s a type of securities to be issued, and all other related-details are mentioned in the underwriting agreement.
The bank presents registration statements when both the bank and company comes under the terms of the underwriting deal which has to be filed with the Securities and Exchange Commission. This statement contains information about the particular company and its offerings including management and any legal problems who owned stocks before the company goes public.
Then the SEC investigates and ensures about the company’s detailed information submitted whether all the data is relevant and disclosed. The SEC works with the company when everything is approved, and they set a date to post about IPO
After its approval, the underwriter put together its financial information on the company which is doing IPO.
There are many IPOs in India and Upcoming IPO’s in 2021 India are listed below and this will benefit you to know and choose which IPO is available in the market and what profits you gain from them.
Upcoming IPO in India 2021
|Company Name||IPO size of approx||Tentative date|
|Studds accessories limited||450cr||January 2021|
|Suryoday small finance bank Ltd||NA||January 2021|
|Stove kraft limited(pigeon appliances)||500cr||January 2021|
|Sigachi Industries Ltd||NA||2021|
|Heranba industries Ltd||NA||2021|
|Dodla dairy Ltd||500cr||2021|
|Zircon Technologies Ltd||NA||2021|
|Chartered speed Ltd||275cr||2021|
|Stove kraft Ltd||500cr||2021|
|Harsha Engineers Ltd||500cr||2021|
|Narmada Biochem Ltd||NA||2021|
|Century metal recycling Ltd||700cr||2021|
|Penver products Ltd||NA||2021|
|Sembcorp Energy India Ltd||NA||2021|
|Capricorn food products India Ltd||NA||2021|
|Patel Infrastructure Ltd||NA||2021|
|John energy limited||NA||2021|
|Aakash Education service||NA||2021|
|Anmol Industries Ltd||NA||2021|
|Senco gold limited||NA||2021|
|Flair writing industries limited||NA||2021|
|AGS Transact Technologies Ltd||NA||2021|
|Shyam Metallic and energy limited||NA||2021|
|Anand Rathi wealth management Ltd||NA||2021|
|Crystal crop protection Ltd||NA||2021|
|Penna Cements Ltd||NA||2021|
|Barbeque Nation Hospitality Ltd||NA||2021|
|Reliance general insurance company Ltd||NA||2021|
|National stock exchange NSE||NA||2021|
|Lite bite Foods||NA||2021|
|National insurance company||NA||2021|
|Indian Renewable energy Development Agency Ltd||NA||2021|
IPO List in 2021 India
|Indian Railways finance corporation Ltd||NA||2021|
|Sandhya Marines Ltd||NA||2021|
|Atricia Convergence Technologies Ltd||NA||2021|
|GR Infraprojects Ltd||NA||2021|
|PNB met life insurance Ltd||NA||2021|
|Shakun Polymers Ltd||NA||2021|
|Fino bank payment Ltd||NA||2021|
|Montecarlo Ltd(construction company)||NA||2021|
|Puranik Builders Ltd||NA||2021|
|Vectus Industries Ltd||NA||2021|
|Miltec Machinery Ltd||NA||2021|
|Bharat hotel limited||NA||2021|
|Muthoot microfin limited||NA||2021|
|ASK Investment managers Ltd||NA||2021|
|Sansera Engineering limited||NA||2021|
|T&T infra limited||NA||2021|
|Inventia healthcare limited||NA||2021|
|NECCON Power & Infra limited||NA||2021|
|Emami cement limited||NA||2021|
|Shriram properties limited||NA||2021|
|Bajaj Energy limited||5400cr||2021|
|SAMHI Hotels limited||2000cr||2021|
|HDB financial services Ltd||9000cr||2021|
|JEEJAY Surrendera Park hotels Ltd||1000cr||2021|
|National commodity derivatives exchange Ltd(NCDEXIPO)||1700cr||2021|
|Telecommunications Consultants India Ltd(TCIL)||1500cr||2021|
|Jai Kumar constructions Ltd||NA||2021|
|Brookfield Asset Management REIT Ltd||NA||2021|
|Blackstone-panchshil Realty REIT Ltd||NA||2021|
|Lava International Ltd||NA||2021|
|Aditya Birla Sun Mutual Fund Ltd||NA||2021|
|Indigo paints Ltd||NA||2021|
|Laxmi Organic Industries Ltd||NA||2021|
|Craftsman Automation Ltd||NA||2021|
Important Tips For Investing in an IPO
- How you can select an IPO
- Know how to utilize the funds
- Apply at a cut-off price
- Evaluate the company’s prospects in detail.
Companies that are expected to go Upcoming IPO List in 2021 India?
Upcoming IPOs in India 2021 that are set to dominate the market with Kalyan jewelers, indigo paints, stovekraft, food delivery app unicorn zomato are in the pipeline.
And if the government fulfills its promise of making the nation’s powerful financial organization LIC public then 2021 will be the record year for IPO as LIC will command its worth assets which will run into trillion rupees.
The biggest among the IPO candidates is Kerala-based jewellery major Kalyan jewellers.
India one of the fastest-growing consumer economies is having companies that are expanding their size and want to go public to raise their capital there is a huge interest from both foreign and domestic investors for consumer-focused firms.