The Indian stock market is on a great bull run and IPOs are runaway successes. Naturally there is a tendency to disguise many forms of public offers as IPOs and mislead the investors. SEBI clearly distinguishes between IPO (Initial Public Offer) and FPO (Follow-on Public Offer). But still a significant number of news reporters and analysts refer to FPOs as IPOs. In some cases it is just ignorance of the difference between an IPO and FPO, but when the mistake is done by "interested parties" you are really not sure if it is ignorance or if it is deliberate.

Take the example of the recently completed follow-on public offer of Andhra Bank between Jan 16-20, 2006. Here is SEBI's press release categorizing this as an FPO. Now check out the number of news reports from leading news sources referring to this as IPO. Check out ICICIDirect.com's (an online stock broking company) stock research for Andhra Bank. Nowhere in the research does it mention that this stock is already listed and this is a follow-on offer. In the valuation section it does not compare the issue price band to the current quote for the listed stock. (If I'm looking at investing in an FPO shouldn't I compare the issue price with the current stock price?) An uninformed investor is lead to believe that this is an IPO. Ignorance or deliberate? You be the judge.