Explain IPO Grading.

IPO Grading It is a service aimed at facilitating the assessment of equity issues offered to public. The grade assigned to any individual issue represents a relative assessment of the fundamentals of that issue in relation to the universe of other listed equity securities in India. Such grading is assigned on a five point scale with a higher score indicating stronger fundamentals. IPO Grade 1 - Poor Fundamentals IPO Grade 2 - Below average Fundamentals IPO Grade 3 - Average Fundamentals IPO Grade 4 - Above average fundamentals IPO Grade 5 - Strong fundamentals Thus IPO Grading facilitates investors better appreciate the meaning of disclosures in the issue documents to the extent that they affect the issue's fundamentals. It serves as an additional investor information and investment guidance tool.