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Short Article On 'FPO'

FPO, or follow-on public offering, allows a publicly traded company to issue additional shares to the public to raise more capital from the stock market after their initial public offering. FPOs can be dilutive by issuing new shares or non-dilutive by offering existing shares from current investors. FPOs provide benefits like improving market liquidity and giving investors a chance to invest in an established company with a proven track record. They are an important tool for companies to raise additional capital and improve stock exchange liquidity while also providing investors an opportunity to invest in a proven company that may continue growing.

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788 views1 page

Short Article On 'FPO'

FPO, or follow-on public offering, allows a publicly traded company to issue additional shares to the public to raise more capital from the stock market after their initial public offering. FPOs can be dilutive by issuing new shares or non-dilutive by offering existing shares from current investors. FPOs provide benefits like improving market liquidity and giving investors a chance to invest in an established company with a proven track record. They are an important tool for companies to raise additional capital and improve stock exchange liquidity while also providing investors an opportunity to invest in a proven company that may continue growing.

Uploaded by

himanshu
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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SHORT ARTICLE ON ‘FPO’ (SECONDARY IPO)

F PO, otherwise called Follow-on public offering, is a kind of First sale of


stock (Initial public offering) in which an organization that is as of now
public issues extra offers to the general population. FPOs are utilized by
organizations to raise extra capital from the financial exchange after the first sale
of stock. They are otherwise called Optional Initial public offerings.
FPOs are a typical way for organizations to raise assets for business development,
obligation reimbursement, or to fund other key drives. FPOs are like Initial public
offerings in that they include the offer of offers to the general population, yet
dissimilar to Initial public offerings, FPOs include the offer of extra offers by an
all-around recorded organization.
FPOs can be either dilutive or non-dilutive. Dilutive FPOs include the issuance of
new offers, which can weaken the proprietorship stake of existing investors. Non-
dilutive FPOs include the offer of existing offers by current investors, like
institutional financial backers, without the issuance of new offers.
One of the advantages of FPOs is that they can be utilized to further develop
liquidity in the securities exchange. By expanding the number of offers accessible
for an exchange, FPOs can build the volume of offers exchanged and further
develop the cost disclosure process.
FPOs can likewise be valuable for financial backers, as they give a chance to
purchase partakes in a generally settled organization that has a demonstrated
history on the lookout. Financial backers can utilize this data to settle on informed
speculation choices and possibly benefit from the development of the organization
later on.
All in all, FPOs are a significant apparatus for organizations to raise extra capital
and further develop liquidity in the financial exchange. They furnish financial
backers with a chance to put resources into a generally settled organization with a
demonstrated history and can be either dilutive or non-dilutive. With cautious
preparation and execution, FPOs can be a viable way for organizations to raise
assets for business development, obligation reimbursement, or other key drives
Example:- In 2022 Ruchi soya has come with their FPO with a price band of Rs.
615 to Rs. 650 and is Oversubscribed by 3.60 times. I have also invested in Ruchi
soya FPO and it has generated a handsome amount of profit.

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