InvestorQ : What is the role that merchant bankers play in an IPO and why they matter?
Crowny Pinto made post
IPO

What is the role that merchant bankers play in an IPO and why they matter?

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Aashna Tripathi answered.
3 years ago
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The merchant banker or the investment banker plays a pivotal role in any public issue. They are also popularly referred to as the Book Running Lead Manager (BRLM) and virtually manage the complete issue from end-to-end. Right from getting the prospectus filed and approved by SEBI to determining the price range to making the selling and market plan for the IPO as well as post listing support is all handled by the merchant bankers. Since the merchant banker is the nodal contact point for everything pertaining to the issue, there is likely to be a major need for the merchant banker to take ownership for the entire process including registry and listing.
The past track record and credibility of the merchant bankers matters a lot since most investors tend to invest in IPOs based on the reputation of merchant bankers. Investors normally prefer merchant bankers with a strong pedigree, who have handled many IPOs successfully in the past as well as those merchant bankers whose IPOs have generally done well post listing.
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