Glossary

Price Band

A price band is the floor-to-cap price range a company sets for its IPO, within which investors bid, with the final issue price decided based on demand across that range.

What It Means

A price band is the floor-to-cap price range a company sets for its IPO, the range within which investors place their bids. The final issue price is then fixed somewhere inside that range based on how much demand comes in at each price point, not chosen upfront by the company alone.

This is a different thing from a Circuit Limit, which limits how far an already-listed stock's price can move in a single trading day. A price band applies once, during the IPO's bidding window; a circuit limit applies every trading day after the stock lists.

IPO Price Band Meaning Explained | TraderStack