business π§ Spotting red flags in IPOs before you invest π©
IPO activity in Indian markets is currently heating up, with companies raising about βΉ22,400 crore as of August 26th. Investors must scrutinize the red herring prospectus (RHP) since IPO businesses lack trading history. Red flags include if existing investors are just exiting or if financials were artificially boosted. Caution is advised regarding promoters with erratic track records and high contingent liabilities. Ultimately, growth, profitability, and fair valuation compared to peers are key checks.