Initial Public Offering
Initial Public Offering is when an unlisted company makes a fresh issue of shares or offers for sale its existing shares to the public. IPO is the first step in listing and trading of a company’s shares in a stock market.
Follow on Public Offering
Follow on public offering is when an already listed company makes either fresh issue of shares to the public or offer for sale existing shares to the public by way of an offer document. Offer for sale is typically allowed when the company must satisfy listing or continuous listing obligations.
Rights Issue
Rights issue is when a listed company proposes to issue fresh securities to existing shareholders as on record date. The rights are normally offered in a particular ration to the number of securities held prior to the issue. Rights issue can be used by companies to raise capital without diluting stake of existing shareholders.
Preferential Issue
Preferential issue is an issue of shares of a listed company to select group of persons, being neither a rights issue or public issue. Preferential issue can be used by companies to quickly raise capital, subject to compliance with Companies Act and SEBI regulations.
Private Placement
Private placement is an offer of shares of a company to a select group of persons through issue of a private placement offer letter.