---
title: What is the issue price?
description: Learn about outstanding shares, their impact on financial metrics, and how changes can influence a company's valuation and performance. Discover key insights for investors.
---

[Yelza FAQ ](https://yelza.com/faq)

# [What is the issue price?](https://yelza.com/faq/what-is-the-issue-price)

 Written by [Yelza blogger](https://yelza.com/faq/author/yelza-blogger) | Mar 16, 2026 10:36:45 AM

The issue price is the price at which a company first sells its shares to investors when issuing new shares. This typically occurs during an initial public offering (IPO) or when a company raises additional capital by issuing new shares to the market.

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The issue price determines how much investors pay when shares are first offered to the market.

 

When a company issues new shares, it must decide the price at which those shares will be sold to investors. This price is usually based on factors such as the company’s financial performance, expected growth, and overall market demand. Once the shares start trading on the stock exchange, the market price may rise or fall depending on supply and demand. The issue price is important because it determines how much capital the company raises and influences the initial valuation of the company in the market.

 

 

 

 

 

 

Short example:

 

Suppose a company issues 1 million new shares at an issue price of $20 per share.

 

Investors who participate in the offering buy the shares for $20 each.

 

If the shares begin trading on the stock exchange at $25, those investors immediately have an unrealized gain of $5 per share.

 

**Disclaimer: Investing brings **risks. Our analysts are not financial advisors. Always consult an advisor when making financial decisions. The information and tips provided on this website are based on our analysts' own insights and experiences. Therefore, they are for educational purposes only.* *

[View full post](https://yelza.com/faq/what-is-the-issue-price)

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