Lead managers in an IPO are SEBI-registered financial institutions, most commonly merchant banks, appointed by the company going public and play a crucial role in helping the company raise capital by issuing shares to the public. Here are some of the key responsibilities of IPO Lead Managers:
Due Diligence: Lead Managers conduct due diligence of the company going public, including reviewing its financial statements, business operations, and legal documentation to ensure that the company meets the regulatory requirements for launching an IPO.
Structuring the IPO: They help structure the IPO by determining the number of shares to be issued, the price band, and even the timing of the IPO.
Marketing and Advertising: Marketing and advertising are also a part of the role of Lead Managers in an IPO. They help the company create the IPO prospectus, red herring prospectus, and other marketing materials that provide details about the company to potential investors.
Compliance with SEBI Regulations: Lead Managers ensure that the company complies with all SEBI regulations related to IPOs. They help prepare the necessary documents and disclosures and ensure that they meet regulatory requirements.
Allocation of Shares: Lead Managers work with the registrar to allot shares to investors and ensure that the allotment process is fair and transparent. They also coordinate with depositories to credit the shares to investors' demat accounts.