FAQs

Question

Rulings for Fresh IPO where the company promises to clear its Debt and possibly become Shariah Compliant?

Answer

A shariah conscious investors should evaluate and find out whether the proceedings of the IPO will help the company to clear its debt and make it Shariah Compliant. If on evaluation post-IPO the share turns out to be Shariah compliant then the investor can invest in such a company provided it is also complying with the other Shariah parameters and if the shares are allotted one should hold the stock till the release of the next Annual Report to see whether the company has adhered to its promises made in its Draft Red Herring Prospectus (DRHP).