IPO
Initial Public Offering, when a private company first sells shares to the public.
An IPO is the company raising money from public investors for the first time. The price band and lot size are decided in consultation with merchant bankers; you apply through ASBA in your bank account or your broker app. If oversubscribed, allotment is by lot for retail. After listing, the share trades on the secondary market. IPO returns are highly variable, the SEBI study on IPOs found roughly half traded below issue price within a year.
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Inside Finlo
A 60-second lesson that puts this term in context, alongside the others, lives inside the Finlo app.