What is DRHP in IPO? DRHP Explained
In recent times, more
and more IPOs have been coming into the Indian stock markets and this simply
means that a large number of investors have been vying to invest in IPOs. If
you are searching for an upcoming IPO in India,
it becomes more than necessary to have proper knowledge about various technical
terms involved in such a scenario. Understanding of DRHP in IPO is necessary
because this would help you serve the purpose of making long-term and
short-term gains and not having such information could make you lose your
investment.
What
is DRHP (Draft Red Herring Prospectus)?
DRHP stands for Draft
Red Herring Prospectus. It plays a pivotal role in helping investors gain
truthful insights about investing in a specific company’s IPO. It is maintained
as a document that needs to be filed by companies as stated by DRHP. The next
step is that SEBI reviews this DRHP document and makes sure that the company
has made all necessary disclosures.
It should be kept in
mind that the document is a kind of draft which SEBI has made it mandatory for
companies to make all-important revelations. The purpose of this step is to
help investors know all the necessary information about the company they are
looking to invest in.
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