Investing in an Initial Public Offering (IPO) is one of the most popular ways to participate in the growth of companies entering the stock market. In India, applying for an IPO has become simple, secure, and fully online. Here’s a complete step-by-step guide to help you get started.
1. Prerequisites Before Applying
Before you apply for an IPO, make sure you have:
- Demat Account – to hold your shares in electronic form.
- Trading Account – with a broker (for buying/selling shares after listing).
- Bank Account (ASBA-enabled) – Application Supported by Blocked Amount facility ensures funds remain in your account until allotment.
- UPI ID (for retail investors) – for quick online payment authorization.
2. Ways to Apply for an IPO
There are two main methods:
a) Through Net Banking (ASBA Facility)
- Log in to your bank’s net banking portal.
- Go to the IPO/ASBA section.
- Select the IPO you want to apply for.
- Enter your lot size, bid price, and Demat details.
- Confirm and submit.
- Funds will be blocked in your bank account until allotment.
b) Through Broker Platforms or UPI Apps
- Log in to your stockbroker’s mobile app or trading portal.
- Choose the IPO from the “IPO section.”
- Enter your bid details and UPI ID.
- Approve the mandate in your UPI app (Google Pay, PhonePe, Paytm, etc.).
- Once approved, the amount will be blocked until allotment.
3. Important Points to Remember
- Lot Size – IPOs can only be applied in fixed lot sizes (e.g., 1 lot = 50 shares).
- Price Band – you can bid at the cut-off price to maximize allotment chances.
- ASBA Advantage – your money stays in your account until allotment; you earn interest until then.
- Allotment – if you get shares, the money is debited; if not, the blocked amount is released.
4. Checking IPO Allotment Status
After the IPO closes, you can check your allotment status through:
- Registrar’s website (e.g., Link Intime, KFintech).
- Stock exchange websites (NSE/BSE).
- Broker’s app (if supported).
5. After Allotment
- If Allotted – Shares are credited to your Demat account before listing day.
- If Not Allotted – Blocked funds are released, and you can use them for the next IPO.
Quick Tips for Investors
- Apply at the cut-off price to avoid missing out.
- Use multiple family accounts (different PANs) to increase allotment chances.
- Keep an eye on Grey Market Premium (GMP) for market sentiment.
- Never apply with borrowed money; IPOs carry risks.
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