Hi
Can any one tell me about how 2 fix the Price Brand in an
IPO & how 2 get such result.
Answer Posted / simriti uppal
There are two methods of fixing price band.One is fixed
price process and the other is book building process.Under
fixed price process the price of the securities offered or
allotted are know to investors in advance.Payment is to be
made at the time of subscription and refund is made at the
time of allotment.
Book Building is basically a capital issuance process used
in Initial Public Offer (IPO) which aids price and demand
discovery. It is a process used for marketing a public offer
of equity shares of a company. It is a mechanism where,
during the period for which the book for the IPO is open,
bids are collected from investors at various prices, which
are above or equal to the floor price. The process aims at
tapping both wholesale and retail investors. The offer/issue
price is then determined after the bid closing date based on
certain evaluation criteria.
| Is This Answer Correct ? | 9 Yes | 2 No |
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