Master

IPOs Like
A Pro!
Know Common
IPO Terms and
what they mean
Notes

Offer For Sale

The portion of a company's shares that
are being sold by existing shareholders
in an IPO

Example : In the recent Mamaearth IPO,

company's founders - Ghazal & Varun Alagh
sold a portion of their shares to the public
 Notes

Fresh Issue IPO

An IPO where company sells new shares of
stock to the public for the first time to raise
new capital

Example : Doms raised 350 crore by selling new

shares in its fresh issue IPO in 2023
Notes

Price Band
The range of price within which a
company's shares are expected to be sold
in an IPO

Example : Motisons Jewellers sets a price band of

₹ 52 to ₹ 55 per share
Notes

Lot Size
The minimum number of shares
that an investor must purchase in an
IPO
Example : A company might set a lot size of
200 shares, meaning that investors must buy at
least 200 shares of the company's stock
Notes

Oversubscription
When there is more demand for a
company's shares than there are
shares available in an IPO
Example : A company's shares might be
oversubscribed by 3 times, meaning orders were
3 times the shares available
Notes

Undersubscription
When there is not enough demand
for a company's shares in an IPO

Example : Muthoot Microfin shares list at

5.40% discount to IPO price