7. Explain 'Private Placement' and 'e-IPOs' as methods of floatation of new issues in the primary market.
Solution:
In the method of private placement of shares, the securities are allotted only to some selected individuals and big institutional investors rather than to the general public. Private Placement helps to raise capital more quickly than a public issue. Procedure of issuing these shares is not lengthy and economical for the firm.
E-IPO's : It means electronic initial public offering, when the new company wants to collect funds with the help of initial public offering they have the option of issuing the shares with the help of online. This is called e-ipo's.
In the method of private placement of shares, the securities are allotted only to some selected individuals and big institutional investors rather than to the general public. Private Placement helps to raise capital more quickly than a public issue. Procedure of issuing these shares is not lengthy and economical for the firm.
E-IPO's : It means electronic initial public offering, when the new company wants to collect funds with the help of initial public offering they have the option of issuing the shares with the help of online. This is called e-ipo's.