How to choose the best IPO?
IPO or Initial Public Offering refers to a company who is applying for the first time to be listed on the stock market. This means IPO companies are for the first time is approaching public for money. Buy Pre-IPO Shares in India to have a desirable investment and considerable profits. How to choose the best Pre-IPO shares in India? Few tips are shared below:
Make a list of all IPO companies:
There are numerous companies showing interest to enlist themselves in the stock market. If you want to get the best shares of the best companies you must make a comparison study of all such organizations. A financial consultancy develops a list of all such companies who are in the process of hitting the Indian capital market. Buy unlisted shares in India after checking the whole list and understanding the characteristics of the offerings made by these companies. Generally, you should go for companies who have better growth rate and better future prospects than the rest.
Checkout the company history:
As an IPO is generally new in the stock market you have limited information about how the company performed in the share market in previous years. In such cases, it is best to research on the company history, its financial data and also the prospectus which is shared by the company as an exercise to enable investors assess the value of their offerings. If you do not have enough time or knowledge about how to utilise this information for your benefit, engage a consultancy who can help you with all these.
Determine your Requirement:
IPO shares are generally meant for long term investment. As these companies are just entering the capital market you must wait for a considerable amount of time to see your investment reap into profits. Hence first you need to determine how long you are ready to wait and then choose Pre-IPO shares in India. A financial consultancy can assist you in this regard by helping you choose the right company depending on your requirement. Generally, IPOs are suggested for individuals who are long standing and are long established in the market.
Choose strong brokers:
Quality brokerages is the USP of gaining profits in the IPO market. Choose a brokerage firm based on its reputation as a good firm takes more caution when underwriting a company than the smaller ones; hence there is less risk of losing money when you have tie ups with good brokerage firms.
Check the Lock in Period:
It is often difficult to understand the credibility of an IPO company at the early months because the insiders of the company hold its shares and are not allowed to sell these till a definite time. After this stipulated time is over, they rush to sell their shares and realize the profits and this is the time the price of the share might decrease due to more supply than desired.