PRIMARY MARKET

ISSUE
MECHANISM OF NEW ISSUES

1. PUBLIC ISSUE THROUGH PROSPECTUS :-

The company issues prospectus for subscription by
the investing public. It is a direct offer by the
issuing company to the public in general. This is
the most common method of securities by
companies.

2.THROUGH OFFER FOR SALE/BOUGHT-OUT DEALS :-

This offer is made through intermediaries, such as
issuing houses or firms of stockbrokers. A prospectus
with prescribed minimum contents is distributed to
applicants on a non-discriminatory basis. In bought out
deals, the promoters of an unlisted issuing company
make an outright sale of equity shares to a single
sponsor or the lead sponsor.
3.PRIVATE PLACEMENT :-
This is a direct sale of securities by a company to
institutional investors. Here no prospectus is issued.
Private placement covers shares, preference shares &
debentures.

4. RIGHT ISSUES :-
This is a fresh issue of shares by an existing company to
its existing shareholders in proportion to the number
of shares already held by them.

5. ISSUE OF BONUS SHARES :-

Bonus shares are issued to the existing shareholders by
converting free reserves or share premium account to
equity capital without taking any consideration from
investors.
6.BOOK BUILDING :-
It is a process of price discovery, a market related
process of demand & price determination. It is
transparent & flexible pricing method based on
feedback of investors.
7. STOCK OPTION :-
A company whose shares are listed on any stock
exchange may offer securities to its employees through
Employee stock option scheme (ESOPS).