by Rajen KumarMiddlemen Rule PSU Banks
The Union Finance Ministrys recent advisory to the public sector banks to take a tough stand while sanctioning loans to the corporate houses is, to say the least, amusing. The advisory,...
Special ReportsOct 2013
Association of Healthcare Providers India AHPI represents the vast majority of healthcare providers in India to work as not for profit organization for advocacy with...
IPO is a dream for any SME, given the reputation attached with being a listed company. It is also an important source of funds for expansion projects. Key ingredient to a successful SME IPO is a strong business model. The company should strive to become one of the key players in the segment in which it is operating in terms of size, relative profitability, sustainable competitive advantage, etc. Once SME promoters and management make up their mind for SME IPO, the time starts now, the process begins, the speed depends on the what SME company has achieved so far in terms of market / business development, customer acquisition, quality control, technology empowerment and marketing.
The risk is to plan to raise funds through the IPO channel. Running an IPO is an expensive process. As the company is widely discussed during the IPO process, its market reputation is also at stake. A major risk therefore is of poor market response. The company's image also takes a hit if the market reaction is unfavorable. Unlike other IPOs, in case of SME IPO the responsibility is on merchant bankers to fully underwrite the issue and hand holding SME for 3 yrs period besides co-operative business arrangement with market makers. If the IPO has lower participation, post-issue trading volumes may be low denying the company of many benefits which it seeks from an IPO.
The first step:
SMEs must approach a professional who offers SME IPO specific (a) Brain storming session with SME promoters and management towards IPO and other options of raising finance, Dos & Don'ts (b) Incubator & Mentoring services for SMEs towards IPO incl. interfacing finance and marketing (c) Branding SMEs for IPO (d) Strategizing 360 degree, 7 business functions - internal and external marketing and management (e) Preparing for professional outlook (f) Systems to make organized approach to everything in day to day business viz. (a)-(f) : Value Creation and Visibility Marketing for SMEs. Obviously, compliance are looked after by company appointed CA. This is an important phase ranging from few months to couple of years to get the best out of IPO and PE.
- Winner of appreciation award for promoting SMEs in India.
- 1st ever Indian magazine to penetrate tier II, III cities & the rural belt.
- Industry Partnerships include CII, FICCI, ASSOCHAM, PHDCC, AIMA, ITPO, SME Network, Federation of Indian Micro Small Enterprises (FISME)
- Official Magazine Partners for several national & international MSME events.
The Last Word
Of the 80 odd seasons that he has been through, he savoured less springs and suffered more rains, proverbially. Not that time took a toll on his age, it was his own siblings who dumped, nay disowned,...
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