Basic IPO FAQs

What do you mean by Basis of allocation or basis of allotment?

The registrar of an IPO and the investors of IPO publishes a documents i.e. The Basis of Allotment, or Basis of Allocation. This document contains information on the final price for an IPO, information about issue subscription (bidding), and share …


In how many days does the issue open?

Book Building IPO is open for 3-7 days. If the price of an issue remains unsubscribed within the initial days, it may be extended for another 3 days. The issuer company and its manager will decide how long the issue …


Can someone apply through more than one application in IPO with the same name?

One person cannot apply for multiple IPO applications at once. This is a rule. If with the same name you submit more than one applications to an IPO , same demat account, or same PAN number, your entire application will …


Is investing in IPOs less riskier than in direct stock market?

No. IPO's can be a great way to get into stocks. Some IPOs offer poor returns. There are few risks involved in applying for an IPO. Stock listing at a lower price than the issue price Investor doesn't get allotment …


Will I get guaranteed amount of shares if applying for an IPO?

Applying for shares in an IPO, or bidding for shares in IPOs does not guarantee that you will get the shares. It's a bidding process so the amount of bids received in each category, the price paid by investors, etc. …


For an IPO,what is the 'Market lot size' & 'Minimum Order quantity'?

Investors should be aware of two key factors when bidding on an IPO: IPO 'Market Lot’ and IPO 'Minimum Order Quantity. The minimum order quantity, as the name suggests, is the minimum amount of shares an investor can bid for …


After submitting the application in IPO,what details I should keep?

This is a crucial question for all IPO investors. Keep the following information in mind when you apply for an IPO. Application form photo copy Cheque photo copy Online IPO submissions require a number to identify the applicant


IPO remains open for how many days?

According to Clause 8.8.1, the subscription list for public issues must be open at least three working days and no more than ten working days. Book built issues have a minimum and maximum period of bidding that is between 3-7 …


Is PAN number mandatory for applying in an IPO?

Yes. Since July 2006, IPO applicants must have a PAN number. Incomplete or incorrect forms are considered a faulty application, and are not eligible for IPO allotment. Before submitting your IPO application, it is highly recommended that you verify your …


Retail investor, I would like to invest more than Rs 1 lakhs in an IPO. What is the best way to invest in the Non-institutional bidders' category? What are the pros and cons of investing in this category?

A retail investor can bid more than Rs 1 Lakhs for an IPO if they apply in the 'Non-Institutional Investors' category. In the 'Non-Institutional Investors' category, there is no maximum bid amount. Advantage: You can apply for more than Rs …


Differentiate between RII,NII,QIB, & Anchor Investor

Shareholders may apply for shares in any of the following categories Retail Individual Investor (RII). Indian resident Individuals, NRIs, and HUFs are under RII category who's application below Rs.2 lakhs in an IPO. 35% or more of the Offer are …


How is Floor price different from Cut-off price for a book - building issue

The price range for Book Building Public Issue was set by the company that came up with it. The price range usually includes a higher and lower level. The floor price is the lowest level at which an IPO can …


what are the basic differences between Book building and fixed price issue

The initial public offering can be done through either the fixed price or book building method. There is a difference between shares offered by book building and shares offered by a normal public issue- Features Fixed price process Book building …


What are the life cycle of an IPO?

Here is the detailed process flow for a 100% Book Building Initial Public Offering IPO. This flow is intended to be easy to understand for retail IPO investors. These are the most common steps involved in an IPO's life cycle. …


How can you define the life cycle of an IPO prospectus?

Stage 1: Draft Offer document The Issuer Company and Book Building Lead Manager prepare the "Draft Offer Document". This document is sent to SEBI for review. SEBI will review the document and either ask the lead managers for changes or …


What are Primary market & Secondary market?

Primary Market This is where investors can purchase shares directly from the issuer to increase their capital. Secondary Market Stocks are traded in secondary markets after being initially offered to investors in primary market (IPOs, etc.). Register on a stock …


What does 'follow on Public offering' or FPO means?

A follow-on public offering (FPO), is a public issue of shares by a company that has been publicly listed. FPO stands for a stock offering of additional shares by a company already listed publicly and who has gone through the …


What is role of Lead managers in IPO?

Companies appoint lead managers to manage their independent financial institution. To manage large IPO's, companies may appoint multiple lead managers. They are also known as Book Running Lead Management and Co-Book Running Lead Managers. They are responsible for initiating the …


What a registrar of an IPO does?

The primary body responsible for processing IPO's is the Registrar of a Public Issue. They are registered financial institutions with SEBI and stock markets. These individuals are appointed by companies going public. A registrar is responsible to process IPO applications, …


'Date of issue' is decided by whom?

After the IPO Draft Prospectus has been approved by Stock Exchanges and cleared by SEBI, it is up to the company to decide when and how long they will be going public. Before deciding the date, company consults with the …