IPO checks
13 factual conditions, each with one fixed threshold, read from the key figures of every issue newboard has studied. A condition met is a fact to read up on in that issue's study. None of them is a score or a verdict, and an issue that meets none is not thereby cleared of anything.
| Check | Threshold | Issues meeting it | Issues with the figures |
|---|---|---|---|
| Offer for sale is most of the issue | The offer for sale is more than 50% of the issue, by value at the upper band. | 13 | 162 |
| Profit grew much faster than revenue | Profit CAGR over the record is at least 20 points above revenue CAGR, and at least 1.5 times it. | 139 | 280 |
| Operating cash flow negative | Operating cash flow in the latest full year is below zero. | 126 | 293 |
| Cash flow under half of profit | Operating cash flow in the latest year is positive but below 50% of profit after tax. | 51 | 292 |
| Revenue depends on few customers | The largest customer is 25% or more of revenue, or the top ten are 75% or more. | 95 | 218 |
| Other income a large part of profit | Other income is 25% or more of profit before tax in the latest year. | 19 | 197 |
| P/E well above the peers named | P/E at the upper band (post-issue shares) is 50% or more above the median P/E of the peers the prospectus names. | 6 | 31 |
| ROCE under 10% | ROCE in the latest year is below 10%. | 6 | 177 |
| Cases against promoters | The prospectus lists one or more outstanding cases against the promoters. | 116 | 190 |
| Receivable days rose | Receivable days rose by 30 or more between the first and latest year of the record. | 58 | 229 |
| Pre-IPO placement well below the band | A pre-IPO placement price is 30% or more below the upper end of the price band. | 1 | 69 |
| Working capital over 150 days | Working-capital or cash-conversion days are 150 or more in the latest year. | 25 | 118 |
| Net debt over 3× EBITDA | Net debt / EBITDA is 3× or more before the issue. | 27 | 163 |
Figures come from section 28 of each study, where every number is cited to the offer document. A check is run only when the study gives the figures it needs. How the checks are read