Zomato IPO is coming to market for raising the funds.
Means of raising fund in the primary market
Initial Public Offer (IPO)
Initial Public Offer is the process of offering its new securities to the public/ investor for the first time through the issue of prospectus.
It is issued only by the unlisted company (a company whose shares are not traded on a stock exchange).
Follow on Public Offer (FPO)
Follow on Public Offer (FPO) refers to the process where already listed company offers its securities to the public/investor to an offer for sale.
A follow-on offering is the issuance of additional shares made by a company after an initial public offering (IPO).
It is also called as the secondary offering.
Right Issue
A listed company offers its new securities only to the existing shareholders in proportion to their existing shareholding.
In the Right Issue, shares are issued at a discount.
Referential Issue
Under this, a listed company offers its new securities only to a selected class of shareholders.
Bonus Issue
Bonus shares or issues are additional shares given to the existing shareholders without any additional cost, in the proportion of their shareholding in lieu of distribution of dividend.
Private Placement
Raising capital by selling the share to a select group of investors, or individual.
The advantage of the private placement is saving in marketing expenses.
Under this, number of investors who are issued shares cannot be more than 50.
Sweat Equity
• Under this, the share is allotted to top management