Maharashtra State BoardHSC Commerce 12th Board Exam
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Distinguish between the following. Initial Public Offer and Further Public Offer - Secretarial Practice

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Distinguish Between

Distinguish between the following.

Initial Public Offer and Further Public Offer

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Solution

Initial Public Offer

Further Public Offer

1. Meaning: IPO refers to an offer of securities by an unlisted Public Company to the public for the first time.

FPO means an offer of securities by a listed Public Company to the public to raise subsequent capital.

2. Type of issuer company: It is issued by an unlisted Public Company.

It is issued by a listed Public Company.

3. When issued: It is usually issued by an existing company which wants to raise capital from the public for the first time.

It is usually issued by a listed Public company when it wants to raise further capital from the public.

4. Order of issue: IPO proceeds FPO. IPO is the first time sale of shares to the public. Initial Public Offer

FPO is always done after IPO. FPO is the second or subsequent sale of shares to the public.

5. Listing: Company has to get itself listed for the first time before issuing IPO,

Company making an FPO is already a listed company.

6. Risk: It is very risky for the investor as he cannot predict the company's performance.

It is less risky for the investor as he has an idea of the company's past performance and can judge its future performance.

Concept: Methods of Issue of Shares
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APPEARS IN

Balbharati Secretarial Practice 12th Standard HSC Maharashtra State Board
Chapter 3 Issue of Shares
Exercises | Q 4. 1. | Page 66
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