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- A prospectus is any document that invites deposits or offers from the public for the purchase of any shares or debentures of a company.
- When a public company is collecting capital by issuing shares to the public has to issue a prospectus.
- The prospectus must be true and factual as investors decide to invest based on the information given in the prospectus.
- The types of the prospectus issued by a company are:
- Abridged Prospectus
- Shelf Prospectus
- Red Herring Prospectus
- Letter of offer
- Offer Letter
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