<ul><li>Primary markets are also known as new issue market. </li></ul><ul><li>Here all the securities are issued for the f...
<ul><li>Initial public offer is the first time sale of securities by a company. It can be made through any of the followin...
<ul><li>Public issue through prospectus </li></ul><ul><li>under this , a company which wants to raise capital ,issues a pr...
<ul><li>Prospectus enables the public to decide whether to invest or not in a company </li></ul><ul><li>some of its disadv...
<ul><li>Offer for sale </li></ul><ul><li>Under this method , new securities are sold by the company to the intermediary wh...
<ul><li>Private placement </li></ul><ul><li>Under this method securities are sold by the company privately to one or more ...
<ul><li>Thus to conclude offer for sale and private placement of securities are cost effective methods of raising finance ...
<ul><li>Thank you </li></ul><ul><li>Made by:  </li></ul><ul><li>Aditya mahajan </li></ul><ul><li>Aashray khurana </li></ul...
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Initial+Public+Offer[1]

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Initial+Public+Offer[1]

  1. 2. <ul><li>Primary markets are also known as new issue market. </li></ul><ul><li>Here all the securities are issued for the first time </li></ul><ul><li>When a company wishes to raise capital it goes to the primary market. </li></ul><ul><li>Methods to raise capital from primary market: </li></ul><ul><li>Initial public offer </li></ul><ul><li>Rights issue </li></ul><ul><li>Preferential issue </li></ul>
  2. 3. <ul><li>Initial public offer is the first time sale of securities by a company. It can be made through any of the following methods: </li></ul><ul><li>Public issue through prospectus </li></ul><ul><li>Offer for sale </li></ul><ul><li>Private placement </li></ul>
  3. 4. <ul><li>Public issue through prospectus </li></ul><ul><li>under this , a company which wants to raise capital ,issues a prospectus to attract and invite people to subscribes securities (shares or debentures) </li></ul><ul><li>Prospectus is that advertisement ,notice or information by which the general public is invited for the purchase of shares and debentures ,on certain terms and conditions </li></ul><ul><li>It contains the past performance ,background of the company and experience of the promoters. </li></ul>
  4. 5. <ul><li>Prospectus enables the public to decide whether to invest or not in a company </li></ul><ul><li>some of its disadvantages are that this method is costly, it involves larger no of administrative problems. </li></ul><ul><li>It involves large no of intermediaries like merchant bankers, brokers underwriters etc. . </li></ul>
  5. 6. <ul><li>Offer for sale </li></ul><ul><li>Under this method , new securities are sold by the company to the intermediary who sells them to the public </li></ul><ul><li>The intermediaries are generally financial institutions and stock brokers </li></ul><ul><li>They buy the securities from the companies at an agreed price and then sell these securities to the public at a higher price </li></ul><ul><li>Of its advantage is that the issuing company is saved from involving itself from the tedious process of public issue </li></ul>
  6. 7. <ul><li>Private placement </li></ul><ul><li>Under this method securities are sold by the company privately to one or more intermediaries at an agreed price who sells them at a higher price to clients and associates </li></ul><ul><li>Here, securities are not offered to the public even by the intermediaries </li></ul><ul><li>There is no need of issuing a prospectus by the company as the whole issue is sold to the selected intermediaries </li></ul>
  7. 8. <ul><li>Thus to conclude offer for sale and private placement of securities are cost effective methods of raising finance as compared to a public issue through prospectus </li></ul><ul><li>The company saves a lot of expenditure involved in issue of prospectus ,underwriting , advertisement </li></ul><ul><li>These methods are suitable for small as well as big companies raising small amount </li></ul>
  8. 9. <ul><li>Thank you </li></ul><ul><li>Made by: </li></ul><ul><li>Aditya mahajan </li></ul><ul><li>Aashray khurana </li></ul><ul><li>Radhika jaggi </li></ul><ul><li>Mandeep singh </li></ul>
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