ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -These methods are five, including private placement, ESOP, bonus reserves, rights issues, and public issues. Public Issue is the most commonly used method by the companies of India. Through this method, most company securities are made public to the investors in the primary market.

Detailed explanation-2: -It is system of issuing securities through online system. If a company decides to offer its securities through an online system it is required to gets into an agreement with the stock exchange. This is called Initial Public Offer (IPO). Company appoints brokers for accepting applications and placing orders.

Detailed explanation-3: -They are: Offer through Prospectus involves inviting subscription from the public through issue of prospectus. Offer for Sale: Under this method securities are not issued directly to the public but are offered for sale through intermediaries like issuing houses or stock brokers.

Detailed explanation-4: -In a primary market, investors are able to purchase securities directly from the issuer. Types of primary market issues include an initial public offering (IPO), a private placement, a rights issue, and a preferred allotment.