Issues made in primary market

1. Public Issue: Securities are issued to all the people and anyone can subscribe to them. Public issue of equity shares can be categorized as follows:

i. Initial Public Offer (IPO): Where first public offer of shares is made by a company. An IPO can be     in the following forms: 

    - Fresh issue of shares: Where shares are issued by the company to the public investors. In this kind        of  an issue, the funds of investors will go to the company to be used for the purpose for which the          issue is made. 

   - Offer for sale: Where existing shareholders such as promoters or financial institutions or any other        person offer their holding to the public. In this kind of an issue, the funds of the investors will go to        such sellers of the shares and not to the company. 

ii. Follow on Public Offer (FPO): It is made by an issuer/ company that has already made an IPO in        the past and is making a fresh issue of securities to the public. 

2. Preferential issue: In this issue, securities are issued to an identified set of investors like promoters,  strategic investors, employees, etc.. 

3. Right issue: When the company gives its existing shareholders the right to subscribe to newly issued shares, in proportion to their existing shareholding. 

4. Bonus issue: When the existing shareholders of a company are issued additional free shares, in proportion to their existing shareholding and without any additional cost.