Expert IPO investor has the ability to advise you on the matter of both IPO and pre IPO shares. Though the names of both these investment avenues sound similar, they are in fact quite different. An IPO, that is Initial Public Offering, is offered when the company is about to get listed in the stock market. Just before releasing their IPOs, the companies publish their prospectus to attract investors. The amount expected through IPO vary as per the company’s size and its need for capital. Within a period of the month following the publishing of the prospectus, the company lists their shares. The investors can purchase these shares at that moment and may even sell it too if they so desire.
The pre IPO shares in India are quite different from their IPO counterparts. The companies try to raise their capital through pre-IPO shares before 3 to 18 months before the listing in the stock exchange. Thus, one can buy pre IPO shares in India during this time-frame. The investor can invest their money in pre-IPO shares, however, unlike in IPO, the investor does not have the freedom to sell their stock immediately. This freedom is given once the company gets listed. A professional IPO investor will tell you the advantages and downfalls of both IPO and pre IPO shares.
Almost all IPO investors will tell you to buy Pre IPO shares in India because the potential for making large money is much higher through this means. The companies that are offering pre IPO shares offer it at a relatively lower rate than its expected listing price. For instance, if a company is expected to be listed at INR 100 then it would likely offer its pre IPO shares in India at around INR 25. This means the investor has the opportunity to make a fourfold profit by investing in pre IPO shares.
An expert IPO investor knows that high risks are associated with investing in pre IPO share because there are always chances of the company not getting listed in the market. In such a scenario, the investor has to incur a huge amount of loss. However, this risk aspect of pre IPO investment should not put you off completely from making the investment because expert investors have found a simple but elegant solution to this problem. All expert investors recommend buying Pre IPO shares in India only when it has come sufficiently near to get listed. If one invests during such a time frame, the risk of losing the money reduces significantly and the likelihood of making profit increases greatly. Though there are no direct means of knowing when the company is about to be listed, the time-frame can be predicted accurately through the means of different indicators including estimated listing timetable provided by the company, the current CEO, the reputation of people occupying the key management and staff position, profitability of the company, and so on.