InvestorQ : What are the factors to look at when evaluating an IPO to invest?
simran Kaur made post

What are the factors to look at when evaluating an IPO to invest?

Answer
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Rashi Mehra answered.
2 years ago


There are quite a few factors you need to look at before investing in an IPO. For example, you need to understand the business of the company and its prospects. In that sense you must look at an IPO like any other stock. You need to have an assurance that the anchor investors and the promoters are of good pedigree. Also the management of the company must have enough bandwidth to run the company. Pricing is very important because the best of companies can be ridiculously overpriced at steep valuations. Every company is good at a price and bad at another price. You must be able to distinguish. Above all, you must also look at the financials of the company. Even if the company is unlisted, the prospectus has enough useful information about the company to help you take an informed decision.