This paper studies the pricing of IPOs in the Indian context. The paper also examines whether the introduction of Bookbuilding has an impact on IPO pricing. The results suggest that IPO are underpriced. The results also suggest that bookbuilt IPOs show lower amount of underpricing than fixed price issues,. A more detailed study suggests that it has to do more with the size of the issue than the issue process. The paper also suggests a model, which demonstrates that IPO underpricing is unavoidable in a market with information asymmetry. The model predicts that the underpricing is more severe in case of smaller size issues. This is consistent with the empirical findings.