With reference to the initial public offering, consider the following statements:
1. It is the process by which a privately held company, or a company owned by the government raises funds by offering shares to the public or to new investors.
2. One of the conditions laid down by SEBI for companies before they can go to the public to raise funds is that a company must have a minimum average pre-tax profit of Rs 55 crore in at least three of the immediately preceding five years.
Which of the statements given above is/are correct?