@Sandapaul ji, leveraging for trading and investment is legal under current laws. From lender's perspective, when there is demand / opportunity for certain type of product, then they oblige by providing supply.
I myself have never obtained IPO funding, but I don't see anything wrong with it. If someone doesn't have the means, but is willing to take the incremental risk (of fixed interest cost), who are we to point fingers?
Current situation of 6 simultaneous IPOs is a classic case in point when people would have opted for funding.