FPO: Meaning, Definition & Indian Stock Market Examples

Follow-on Public Offer — additional shares sold to the public by an already-listed company.

Disclaimer: This article is for educational purposes only and does not constitute SEBI-registered investment advice. Consult a SEBI-registered investment advisor before making investment decisions.

What is FPO?

A Follow-on Public Offer (FPO) is when a company already listed on a stock exchange issues additional shares to the public to raise fresh capital. Unlike an IPO, FPO investors can compare the offer price to the current market price. FPOs can be dilutive (new shares) or an offer-for-sale (existing shareholders selling).

FPO — Indian Stock Market Example

Yes Bank conducted a massive FPO in 2020 to raise ₹15,000 crore after its near-collapse and RBI rescue. PSU companies like NTPC and Power Finance Corporation have used FPOs to raise capital for expansion. Government divestment sometimes uses the FPO route for PSU shareholding reduction.

Analyse any Indian stock using FPO

Ask Orion: “What is the FPO for [stock] and how does it compare to peers?”

Analyse with Orion

Frequently Asked Questions about FPO

Is a FPO better or worse than an IPO to invest in?

FPOs have a key advantage: you can compare the offer price to the current market price. If an FPO is priced at discount to market, it's attractive; at premium, it's not. Unlike IPOs where you're buying blind, FPO investors have existing price discovery. However, a dilutive FPO reduces EPS and can be negative for existing shareholders.

What is the difference between FPO and rights issue?

Both are secondary offerings by listed companies. An FPO is open to all investors (public). A rights issue is offered only to existing shareholders in proportion to their holdings at a discounted price. Rights issues are shareholder-friendly; FPOs can dilute existing holders unless they participate.

Related Terms

IPO

Initial Public Offering — a company's first sale of shares to the public.

Rights Issue

Offer to existing shareholders to buy new shares at a discount — proportional to current holdings.

Share Buyback

Company repurchasing its own shares — reduces share count, increases EPS.

Promoter Holding

Percentage of shares held by founders/controlling shareholders.

Use FPO Analysis on Any NSE Stock

VestAI’s Orion AI surfaces FPO alongside RSI, MACD, PE, ROE and more — 10 free queries per month.

Try VestAI Free

← Back to full Glossary