Basic IPO FAQs

How can you define the life cycle of an IPO prospectus?

Stage 1: Draft Offer document

The Issuer Company and Book Building Lead Manager prepare the "Draft Offer Document". This document is sent to SEBI for review. SEBI will review the document and either ask the lead managers for changes or approval to proceed with IPO processing.

You can find Draft document on official website of SEBI in the section of 'Reports -> Public Issues:And the Draft Offer Documents are filed with SEBI" at:

A "Draft Offer Document" is a PDF file that contains information for investors who need to know more about the public issue. It contains information about the company, the management, the risk involved in applying for this issue, the financials of the company and why it is raising money via IPO.

Stage 2 - Offer Document

After the SEBI has cleared the draft offer document, it is called an "Offer Document". The modified version of the 'Draft offer document' that SEBI has approved is called "Offer Document".

The "Offer Document", which is a description of the offer, is sent to the registrar for the issue and to stock exchanges where Issuer Company would like to list.

Stage 3: Red Herring Prospectus

After "Offer Document" is cleared by Stock Exchanges, Issuer Company adds Issue size and the price of the issue (and makes it available to all). Now, the issue prospectus is called "Red Herring Prospectus".

Red Herring Prospectus also can be found on SEBI website at:

What do you mean by IPO?

By whom the 'Price Band' is decided?

'Date of issue' is decided by whom?

What a registrar of an IPO does?

What is role of Lead managers in IPO?

What does 'follow on Public offering' or FPO means?

What are Primary market & Secondary market?

What are the life cycle of an IPO?

what are the basic differences between Book building and fixed price issue

How is Floor price different from Cut-off price for a book - building issue

Differentiate between RII,NII,QIB, & Anchor Investor

Retail investor, I would like to invest more than Rs 1 lakhs in an IPO. What is the best way to invest in the Non-institutional bidders' category? What are the pros and cons of investing in this category?

Is PAN number mandatory for applying in an IPO?

IPO remains open for how many days?

After submitting the application in IPO,what details I should keep?

For an IPO,what is the 'Market lot size' & 'Minimum Order quantity'?

Will I get guaranteed amount of shares if applying for an IPO?

Is investing in IPOs less riskier than in direct stock market?

Can someone apply through more than one application in IPO with the same name?

In how many days does the issue open?