IPO/Stock Screener
News on upcoming IPO (Initial Public Offers)
What is an IPO?
Stock Screener for SGX market
What is an IPO?
Initial public offering (IPO) or stock market launch is a type of [public offering] in which shares of a company
are sold to institutional investors and usually also retail (individual) investors; an IPO is underwritten by
one or more investment banks, who also arrange for the shares to be listed on one or more stock exchanges.
Through this process, colloquially known as floating, or going public, a privately held company is transformed
into a public company. Initial public offerings can be used: to raise new equity capital for the company
concerned; to monetize the investments of private shareholders such as company founders or private equity
investors; and to enable easy trading of existing holdings or future capital raising by becoming publicly traded
enterprises.
After the IPO, shares traded freely in the open market are known as the free float. Stock exchanges stipulate a
minimum free float both in absolute terms (the total value as determined by the share price multiplied by the
number of shares sold to the public) and as a proportion of the total share capital (i.e., the number of shares
sold to the public divided by the total shares outstanding). Although IPO offers many benefits, there are also
significant costs involved, chiefly those associated with the process such as banking and legal fees, and the
ongoing requirement to disclose important and sometimes sensitive information.
Details of the proposed offering are disclosed to potential purchasers in the form of a lengthy document known
as a prospectus. Most companies undertake an IPO with the assistance of an investment banking firm acting in the
capacity of an underwriter. Underwriters provide several services, including help with correctly assessing the
value of shares (share price) and establishing a public market for shares (initial sale). Alternative methods
such as the Dutch auction have also been explored and applied for several IPOs.
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