Is it compulsory to have an underwriter in an IPO?

Answer 1

If you want it to be a success, it is. The underwriter guarantees the price you will receive. Its purpose is to market the IPO. It knows how to do that. Of course it does expect to make a hansome profit on the deal. But then again so does the firm offering the IPO.

Answer 2

Yes. You must have an underwriter.

While there are marketing reasons, the primary reason is legal. Without an underwriter the principals of the firm open themselves up to lawsuits if anything goes wrong.