A company going public for the first time needs a roadmap in uncharted territories. As IPO consultants in India, we will help you understand the significance of creating an IPO strategy and the factors to consider.

Why Work On An IPO Strategy

Once a company enters the IPO phase, there are rampant changes it will go through, mainly including its goals and milestones.

-Going public involves multiple moving parts and calls for efficient coordinated efforts by different departments. This includes identifying the goals to be achieved with the IPO, raising a specific amount of capital, increasing brand awareness, etc. Marking deadlines for financial filings, regulatory approvals, and marketing efforts. Also, understanding resource allocation for dedicating the time and effort towards the IPO process.

-An IPO company has to look at various factors like market conditions, industry trends, and investor sentiments to ensure the optimal time to launch any new offerings.

-Determining the valuation for the company’s shares is necessary. It can be a struggle to attract more investors if the IPO price is too high. At the same time, shares priced too low leave less money on the table.

-A proficient IPO strategy will help such companies decide on their target investors. As an IPO consultant, we help identify the right target audience for IPOs, emphasizing institutions and individuals showing interest in the company’s growth. Therefore, it is crucial to recognise the type of investors from their investment style, experience in your industry, and those with short-term and long-term investment goals. 

Six Factors To Consider When Creating An IPO Strategy

We offer advice as SME IPO Consultants for companies that require sound strategies. There are several factors to keep into account while creating a roadmap to a successful IPO company. Let’s explore some of these factors that might be beneficial for those planning to enter the IPO phase.

1) Factors based on answers to questions: To be a listed company, it is necessary to have answers to all these questions ready and implemented.

i)Why do you want your company to go public?

ii)Do you want to raise capital for expansion?

iii)Do you want to pay off a debt?

iv)Do you want to create liquidity for existing shareholders?

2) Your company’s financial trajectory: While entering into an IPO phase, your future success depends on your record of financial health. Your profitability and growth will attract more investors.

3) Alignment of stock market trends and investor sentiment: The stock market is a dynamic, volatile, and unpredictable place. The investor’s sentiment and the stock market’s overall health are two factors that will play a significant role in a company’s IPO success.

4) Adhering to the regulations: As an IPO company, you should ensure to stick to all the relevant regulations determined by financial authorities.

5) Select appropriate investment banks: Make sure to choose the right investment banks to underwrite your IPO. These banks will act as intermediaries in selling a company’s shares to investors.

6) Check the competitor landscape: Check IPO companies similar to yours to determine a realistic evaluation and recognise potential areas of competitive advantage.

It is important to create a sound IPO strategy, which is why you will need professional IPO consultants in India. 

FAQs

1) As an IPO Consultant, where do you recommend researching potential target investors for my IPO company?

-You can reach out to your underwriters who usually have valuable insights about investor preferences and relevant targets. 

-You can also read research reports from reputable firms to identify the major investors in your sector.

-Investment firms make public filings. You can go through those filings to check their investment strategies and holdings to help you identify potential target investors.

2) What is the best way to make a valuation for my IPO company’s share price?

There is no one way to determine your company’s share price. However, you could consider the following metrics and analysis:

-Price-to-Earnings Ratio (P/E Ratio): Comparing a company’s market capital to its net income. Then compare this P/E Ratio to other similar IPOs in your industry.

–Market analysis: Do some market analysis which includes understanding the overall stock market health, analysing recent IPOs in your sector, and estimating investors’ interest through Pre-IPO marketing efforts.