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Initial Public Offering (IPO)
Initial public offering (IPO) or stock market launch is a type of public offering where shares of stock in a company are sold to the general public, on a securities exchange, for the first time. Through this process, a private company transforms into a public company. Initial public offerings are used by companies to raise expansion capital, to possibly monetize the investments of early private investors, and to become publicly traded enterprises. A company selling shares is never required to repay the capital to its public investors. After the IPO, when shares trade freely in the open market, money passes between public investors. Although an IPO offers many advantages, there are also significant disadvantages, chief among these the costs associated with the process and the requirement to disclose certain information that could prove.
CDC eDividend service aims to cater to requirements of the Companies Act, 2017 by offering a centralized cash disbursement facility to the issuers. After its pronouncement, it is mandatory for all the listed companies to credit dividend in electronic form by obtaining bank account details of their shareholders.