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What are the things to look at before investing in an SME IPO?

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The following points should be considered before investing in an SME IPO

  • Company Overview
  • Issue size and price band
  • Issue structure
  • Issue Date
  • Risks and rewards.

Other aspects to be considered are:

  • The company's strengths, weaknesses, opportunities, and threats
  • The company's health
  • The investment horizon
  • The reason for the public issue
  • The business model
  • The promoter and management background

Here are some other things to know about SME IPOs: 

  • An IPO can increase a company's brand image and visibility
  • The company should get consent from the BSE to use its name in the prospectus
  • The company should apply with one or more exchanges
  • The Red Herring Prospectus (RHP) is a preliminary prospectus that contains information about the company
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