What Is A DRHP/RHP (DRAFT RED HERRING PROSPECTUS/RED HERRING PROSPECTUS)? All You Need To Know About DRHP/RHP In Simple Words? (#3)
What Is A DRHP/RHP? Full Form Of DRHP/RHP!
A DRHP ( DRHP stand for Draft Red Herring Prospectus)/RHP ( RHP stands for Red Herring Prospectus) is a document a company makes in order to raise it's IPO (Initial Public Offering). RHP is basically the Wealth Of Information regarding the company.
To raise an IPO, a company is supposed to submit a RHP to The Regulator Of The Capital Market.
A DRHP/RHP is a document report with 500 pages containing important details of the upcoming issue & other details of the company (like - past financial report, further plans & where the capital raised is supposed to be used, etc.) & important details of the owner itself ( like - what's the education of the owner? , etc.)
& The Regulator Of The Capital Market will cross examine the details. Check the information &'ll decide whether this company should be approved or not! The main motive of the "regulator of the capital market" is to keep a close check on the details of every business organisation in order to avoid frauds & scandals. So that they can maintain safety of Investors (buyers & sellers) while they are exchanging securities.
So now if you want to decide whether to invest in a company or not than you have to check a few sections in DRHP/RHP because its harder to go through the entire report.
Here I'll recommend a video so that you can understand the concept easily.
But the way no sponsors!
So here's a informative must watch video according to me if you want to learn to read & understand a DRHP/RHP!
By clicking on this & you can watch the video & learn alot more about DRHP/RHP!
What do you think which kind of company should one must invest in? Any comments!
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Thanks For Reading!
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