An IPO (Initial Public Offering) is the first time a company sells shares to the public. Buy in the IPO and you become one of its first public shareholders.
How an IPO works
The company sets a price (or price band) and offers a fixed number of shares. Investors apply; if demand exceeds supply, shares are allotted (sometimes by lottery). They then list on the exchange for secondary trading.
How to apply
In Nepal, you apply through Mero Share using your Demat account and linked bank (C-ASBA). Elsewhere, you apply via your broker.
Key idea: An IPO allotment is not free money. Some list higher, some list lower — evaluate the company, not just the hype.
What to watch for
- The company’s business and profitability.
- The offer price vs its fundamentals.
- How the money raised will be used.
Key takeaways
- An IPO is a company’s first public share sale.
- Apply via Mero Share (Nepal) or your broker.
- Allotment can be by lottery when oversubscribed.
- Evaluate the business, not just the buzz.
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