IPO or Initial Public Offering refers is the first time when a company offers a certain number of shares to the public. However, there are lot of paperwork, laws, and framework determined by SEBI-Securities Exchange Board of India. When a company makes a public issue or a listed company makes rights issue of more than Rs. Lakhs value should submit an offer document to SEBI. After SEBI has observed the offer letter and replied back with observation letter, it then only company can proceed for the issue. However, the time frame is only 3 months, beyond which the observation letter deems to be invalid.