How to Analyse IPOs?
We frequently come across the news of upcoming IPOs of companies. IPOs are very lucrative for the investors as they help to earn huge gains by investing in companies having significant future growth potential. However, there are also certain risks associated with them, which makes it important to analyse as to which IPO is worth investing. Here is how an IPO can be analysed and investment decision can be made: 1. Find DRHP/RHP of the Company: Draft Red Herring Prospectus/ Red herring Prospectus basically lists out all required information about the company. This document can be downloaded directly from the website of SEBI or from the website of the stock market in which the company is being listed. 2. Understand the Business Model of the Company: a) Products/services and their revenue contribution- I t is important to take an understanding of the products or services offered by the company and their contribution. b) Strength...