Answered: Describe what is IPO and what is…

Describe what is IPO and what is involved in the IPO process. Do you think that it is better to buy shares in an IPO or shares in companies that are already listed on the stock exchanges? Why?

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter14: Corporation Accounting

Section: Chapter Questions

Problem 14PA: You are a consultant working with various companies that are considering incorporating and listing...

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Describe what is IPO and what is involved in the IPO process. Do you think that it is better to buy shares in an IPO or shares in companies that are already listed on the stock exchanges? Why?

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You are a consultant working with various companies that are considering incorporating and listing shares on a stock exchange. One of your clients asks you about the various acronyms she has been hearing in conjunction with financial analysis. Explain the following acronyms and how they measure different things but may complement each other: EPS (earnings per share), EBITDA (earnings before interest, taxes, depreciation, and amortization), and NOPAT (net operating profit after taxes).
You are a consultant working with various companies that are considering incorporating and listing shares on a stock exchange. Explain the importance of the EPS calculation to financial analysts who follow companies on the stock exchanges.
Describe the role of the investment banker in taking a company public. What is an IPO and what steps are taken in order to get the IPO ready for public offering? What does both the investment banker and the company that is going public want to happen on the first day of public trading for the company and why?
What benefits might a company gain from having its shares listed on a stock exchange? +resources
Who determines the offer price in an IPO O a SEBI O b. Lead Merchant bankers O C. Employees O d. Stock exchange
Discuss the benefits and drawbacks, to the shareholders of a company, of a public listing on a stock exchange compared to private equity finance as a way of disposing their shares.
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What is the purpose of an initial public offering (IPO)? How does an investment bank facilitate the process? List and describe several recent IPOs. Discuss the advantages and disadvantages of an IPO.
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What do you mean by private placement of shares? What are the options for a company?
Which of the following statements about IPOs is (are) True: (i) An IPO refers to the first time a firm issues bonds to be bought by the public. (ii) An IPO refers to the first time a firm issues shares to be bought by the public. (iii) A secondary offering IPO is when a firm becomes public by allowing previous investors and founders to sell part (or all) of their shares.