IPO frequently asked questions
Answers to common IPO questions in India: how to apply, what GMP is, allotment, lot size, price band, SME vs mainboard, QIB NII retail, anchor investors and RHP.
Frequently asked questions
What is an IPO?
An IPO (Initial Public Offering) is when a company offers its shares to the public for the first time and gets listed on a stock exchange.
How do I apply for an IPO?
Use a demat account and a UPI-linked bank account. Open the IPO section in your broker app, choose the issue, enter lots and price, and approve the UPI mandate. The money is blocked until allotment.
What is GMP in an IPO?
Grey Market Premium is the unofficial premium at which IPO shares trade before listing. It is not exchange data, can change quickly and may be wrong.
Is GMP reliable?
No. It is an indicator of sentiment only. Use it together with subscription data, financials and valuation, and never as the sole reason to apply.
How are IPO shares allotted?
If the issue is oversubscribed the registrar runs a lottery among retail applicants; each winner receives one lot. If it is undersubscribed, valid applicants normally receive what they applied for.
When is the allotment date?
Usually the third working day after the issue closes. Listing follows soon after, typically within three working days of allotment.
How do I check allotment status?
On the website of the issue's registrar (for example Link Intime, KFinTech or Bigshare) using your PAN, application number or DP/client ID, or in your broker app.
What is the minimum and maximum I can invest?
Retail investors apply in lots. The minimum is one lot (the amount is shown with the issue) and the retail maximum is ₹2 lakh per application in mainboard issues.
What is a lot size?
The minimum number of shares you must bid for, set by the company. You can bid for more only in multiples of the lot.
What is the price band?
The range within which investors can bid, for example ₹95–100. Most retail applicants bid at the upper end or at cut-off.
What is the difference between SME and mainboard IPOs?
SME IPOs are for smaller companies on NSE Emerge or BSE SME, with larger lot sizes, lower liquidity and higher risk. Mainboard IPOs are for larger companies on the main segment.
What are QIB, NII and retail categories?
QIB are qualified institutions, NII are non-institutional investors bidding above ₹2 lakh, and retail are individuals bidding up to ₹2 lakh. Each has its own share of the issue and its own subscription figure.
What is an anchor investor?
Large institutions that are allotted shares a day before the issue opens, at the issue price, with a lock-in. A strong anchor book is often read as a positive sign.
What is an RHP or DRHP?
The Draft Red Herring Prospectus is the document filed with SEBI before the IPO; the Red Herring Prospectus is the final version with price band and dates. Both describe the business, risks and use of funds.
Is my money safe while the bid is blocked?
Yes. With UPI the amount stays in your bank account and is only blocked. It is debited only if shares are allotted.
Is LiveIPOData giving investment advice?
No. LiveIPOData is an information service. We are not a SEBI-registered adviser, and nothing on the site is a recommendation to buy or sell.
Where does LiveIPOData get its data?
Issue details and subscription come from the National Stock Exchange of India's public IPO data and are refreshed every 10 minutes while an issue is open. GMP is indicative and unofficial.