IPO pricing depends on multiple factors. The Lead managers provide the basis of issue price in the red herring prospectus. They compare the price of stock with the listed companies and try to find out the right price at which investors also make money. The price of stock is also dependent upon the prevailing condition of stock market. If the market is in bull mode, the IPO can be priced higher and vice-versa. The price of IPO is also depend upon the factors like monopoly of the business, great management, growing business etc.