What is an IPO in stock market?

An Initial Public Offer (IPO) is the selling of securities to the public in the primary market . It is the largest source of funds with long or indefinite maturity for the company. An IPO is an important step in the growth of a business. It provides a company access to funds through the public capital market.

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How does an IPO get valued?

Strong demand for the company will lead to a higher stock price. In addition to the demand for a company’s shares, there are several other factors that determine an IPO valuation, including industry comparables, growth prospects, and the story of a company .

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