Question

What does the green shoe option provide companies the

Q: Answer-What does the green shoe option provide companies the ability to do during the 30-day stabilisation...

The green shoe option, also known as an over-allotment option, allows companies to intervene in the market during the 30-day stabilisation period following their listing. This intervention involves purchasing equity shares from the market using a company-appointed agent if the share prices fall below the issue price. This mechanism is used to stabilize the share price and ensure a smoother transition for the companys shares in the market after their initial listing.

ability to do during the 30-day stabilisation period after listing?

A Sell additional shares above the issued quantity.

B Buy back shares from existing shareholders.

C Intervene to stabilize share prices through market purchases.

D Issue convertible bonds to raise capital.

E Split shares to increase market liquidity.

Practice Next

More Finance Lectures Questions

Which one of the following is not a method of estimating the National Income of a country?
In the fiscal year 2022-23, what was the Year-on-Year (YoY) growth rate of India's services sector?
India is not part of which of the following?
Farming large areas with minimal labor and capital inputs is known as:
Which statements correctly describe the roles and responsibilities of the Reserve Bank of India (RBI)?

Statements:

1. The RBI formulates...
What does an Inverted Duty Structure imply under the GST framework?
The Monetary and Credit Policy is announced by which of the following?
Which of the following are the specialized wings under the NITI Aayog:

i. Research Wing

ii. Development Wing

iii. Team I...
What is the definition of a supply chain in a business context?
Which one of the following pairs is correctly matched?

What does the green shoe option provide companies the

Solution