Blackstone Code

Gephra’s stock market uses a very unique system for IPOs. Before the market opens, a company going public must submit its issue price and the number of shares to be released to the financial regulatory office.

These shares are then sold at the listed price by the company directly to the market as the primary seller. This price cannot be changed until all the shares are sold.

Therefore, most companies intentionally set a conservative, often undervalued issue price. This helps the shares sell quickly and allows the market to begin fluctuating freely.

A lower starting price also attracts more retail investors. Since it’s affordable, people are more willing to buy in and give it a try.

Whether the stock price rises after the shares are sold depends entirely on how fast they sell. If they sell out immediately, demand will spike and the price will soar.

If the shares don’t sell out, the price may barely move or even fall.

This has led to another phenomenon: when a company is about to go public, they often sign financial agreements with individuals or organizations to pre-purchase their shares.

If the price meets the agreed valuation when the agreement matures, the shares are released to the market. If not, the company buys them back and relists them later.

The advantage of this method is that it can easily generate hype around a stock. For the market, a company willing to sign such agreements shows confidence in its own shares, which excites average investors.