You need to do the same due diligence like you do in case of a secondary market investment. The only difference is that in case of a new issue, not much public information will be available. You need to focus principally focus on management quality, management track record. Profitability of the company’s operations, any pending litigation and contingent liabilities, sustainability of the business model, proposed end use of funds etc. There are no hard and fast rules to identify a good IPO but the above pointers will help you take a more rational decision. One can also take a look at IPO grading by brokers as a benchmark to take a decision on whether the IPO is good or not.