Daily Financial TipsNo. 19: IPO

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IPO is the abbreviation of initial public offering, literally translated as initial public offering, which refers to a company selling its shares to the public for the first time, popularly known as listing.

For example:

1. Zhang San is the owner of a tea shop. Because of his good management and prosperous tea shop business, he plans to open many chain stores all over the country. At this time, Zhang San needs to invest a lot of money, but what if there is not enough money at this time? Zhang San can sell the shares of the tea shop to social investors through IPO, so as to get a lot of money to expand his business.

The process of initial public offering

(1) In the first step, Zhang San needs to find an investment bank to help him complete the IPO counseling work, mainly to help him complete three things: First, help Zhang San's packaging company, such as creating the highlights of milk tea and highlighting the company's business style; The second is to improve the management system of Zhangsan Company and clarify the positions of the company's top management; The third is to sort out the materials and data related to listing and submit them to the CSRC. Prove that Zhang San's tea shop meets the listing conditions.

(2) The second step is to wait for the audit of the CSRC. As many domestic companies apply for listing, they need to wait in line for the approval of the CSRC after submitting their listing applications. If it passes the audit, it can prepare for the stock listing; If it fails, you need to re-prepare the listing materials and queue up for re-examination.

(3) In the third step, when the company completes the audit by the CSRC, it needs to consider the actual value of the company, which determines the price of issuing shares. At this time, relative valuation method is used to estimate.

For example, the Laowang tea shop next door can sell 6.5438+million cups of milk tea a year, and the profit of each cup of milk tea is 654.38+00 yuan. In the end, the valuation of Laowang Tea Shop was 65.438+05 billion. Zhangsan Tea Shop can sell 20 million cups of milk tea a year, and the profit of each cup of milk tea is 10 yuan. Then the final valuation of Zhangsan Tea Shop may be twice that of Laowang Tea Shop, with a valuation of 300 million yuan.

(4) When the company's valuation is determined, the stock price can be determined. For example, half of Zhang San's shares are used to issue shares. The total value of these shares is 65.438+0.5 billion yuan, and the number of issued shares is 65.438+0 billion shares, so the final share price is 65.438+0.5 yuan.

Due to the strict review of the whole process, most listed companies are excellent, so the share price of IPO will rise sharply on the first day. As ordinary investors, they can participate in stock trading activities, subscribe for new shares through securities and sell them on the day of listing to earn investment income.