Why companies get involved in the market

Why companies get involved in the market

Any medium or large scale company will obviously need a large amount of money to raise funds for its business operations. This is when the company knocks on the doors of the stock market. Public companies sell their shares/ stocks in the market in order to raise capital to grow their business and when a company offers its shares in the market, it also means that it is selling a part of its ownership to the public. If a company performs well, then the shareholders get rewarded according to their shareholding in the company but the risk rises when the company is not performing well and the value of the shareholders’ stocks goes down. However most companies list their stocks on multiple markets for easy and smooth allocation of funds and sometimes they also hires the professional underwriters to monitor and purchase their shares.