Question

What are the methods of floatation in Primary Market?

Options

• Offer through Prospectus

• Offer through Sale

• Private Placement

• All of the above

Answer 1

All of the above

Explanation - 

The following are the numerous techniques for floating new issues.

1. Offer through Prospectus : The most commonly used method for raising funds in primary market is offer through prospectus.
2. Offer through Sale: As against offer through prospectus, under the offer through sale method, the company does. not issue securities directly to the public rather they are issued through intermediaries such as brokers, issuing houses, etc
3. Private Placement: Under this method, the securities are sold only to some selected individuals and big institutional investors rather than to the public.