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How to apply for an IPO - all you need to know!

IPO - How to apply
Initial Public Offering (IPO)

Applying for an IPO via ASBA in India: Step-by-Step Guide

What you need to begin with IPO:

  1. Ensure you have a Demat account. You need a Demat account to hold shares acquired through an IPO. If you don't have one, open with your bank or broker.

  2. Choose your platform: You can apply for IPOs through your bank's net banking or mobile application or your broker's platform.

  3. Documents: Keep your PAN card and Aadhaar card handy.

Once you have this sorted, let's begin with the next steps

Step 1: Find the IPO

  • Log in to your chosen platform (internet banking/app or broker platform)

  • Locate the "ASBA" or "IPO" section (usually under "Investments" or "Demat")

  • Find the list of active IPOs and select the one you want to apply for.

Step 2: Enter application details

  • Enter the number of shares you want to bid for (usually in lots)

  • Set your bid price (within the specified range). You can choose a cut-off price or a book price (recommended for higher chances of allotment).

  • Enter your PAN and bank account details.

  • Review and confirm your application.

Step 3: Block funds

  • The ASBA system automatically blocks the bid amount in your bank account (up to a maximum of Rs. 2 lakhs per application). This doesn't mean you've paid, it ensures you have sufficient funds.

  • You'll receive a confirmation message about the blocked amount.

Step 4: Wait for the allotment

  • The IPO bidding process typically lasts for 2-3 days.

  • After the bidding closes, the company finalizes the issue price and allots shares proportionately to eligible bids.

  • You'll be notified about the allotment result within a few days.

Step 5: Allotment and Settlement

  • If you receive allotment, the blocked amount will be debited from your bank account and the shares will be credited to your demat account.

  • If you don't receive the allotment, the blocked amount will be released and credited back to your bank account.

Before you follow the steps, always remember:

  • Research the IPO company thoroughly before applying

  • Bid cautiously and consider the market sentiment.

  • Set a realistic cut-off price to increase your chances of allotment

  • Monitor the IPO news and updates regularly.

Comment down on which IPOs you have applied for and if you've any queries feel free to get in touch!

Happy Investing!

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