IPO application involves applying for shares during an initial public offering. Investors bid for shares while the offering is open. This process, also known as IPO bidding, allows investors to submit bids before the subscription period ends.
In India, IPO bids can be made through two methods:
Online Application:
- Investors can apply online using banking platforms or stockbroker websites/apps. Payment options like UPI or ASBA are commonly used.
Offline Application:
- Physical IPO application forms are submitted to brokers or designated bank branches. This traditional method is suitable for investors preferring offline transactions.’
IPO Application Process
Investors can apply for IPOs through brokers, exchanges, or self-certified syndicate banks (SCSBs) using UPI and ASBA facilities.
Each PAN number allows only one IPO application. Multiple applications under the same PAN will be rejected, except for certain categories like employees and shareholders.
Procedure:
- Access the online IPO application provided by a broker or bank.
- Choose the desired company.
- Complete the IPO application form with necessary details.
- Review the form for accuracy.
- Submit the form.
- Make the payment using UPI, ASBA Net Banking, or provide account details in the physical form.
IPO Application Categories
When applying for IPO shares, investors must select their investor category, each with its own application limits:
Investor Categories Table:
| Investor Categories | IPO Application Limit |
| Retail Individual Investor (RII) | Up to Rs 2 lakhs |
| Non-Institutional Investor (NII) | Small NII: More than Rs 2 lakhs to Rs 10 lakhs; Big NII: More than Rs 10 lakhs |
| Qualified Institutional Buyer (QIB) | Anchor Investors: More than Rs 10 crores; No specified limit for other QIB |
| Employee (EMP) | As defined in RHP document |
| Shareholders | As defined in RHP document |
IPO Application Timing
During an IPO, the subscription window typically spans from a minimum of 3 days to a maximum of 10 days. Applications are accepted by stock exchanges between 10:00 a.m. and 5:00 p.m. on open days, excluding exchange holidays.
Most banks and brokers offer a 24-hour window for submitting IPO applications, but they are forwarded to the exchange at 10:00 a.m. the following day.
On the final day, submission deadlines vary by institution to allow time for processing. For instance, ASBA IPO applications close for retail investors at different times: 2 p.m. for SBI Bank, 3 p.m. for ICICI Bank, HDFC Bank, and Axis Bank, and 2 p.m. for Kotak Bank.
Key IPO Application Timing:
- Opening: 10:00 a.m. on the Issue Opening Date
- Cut-off: 5:00 p.m. on the Issue Closure Date
- Refer to banks for ASBA IPO Application cut-off times on the last day.
IPO Application Fees
Participating in an IPO through a bank or stockbroker typically does not incur charges for investors. Instead, these entities receive a commission from the issuing company for processing the IPO application.
Furthermore, if investors choose to sell the IPO shares allotted to them, the stockbroker may impose a brokerage fee. However, certain brokers, like Zerodha, provide commission-free stock delivery trading, ensuring that investing in an IPO remains entirely cost-free.
IPO Application Form
The IPO application form, typically spanning two pages, serves to capture essential details about the applicant, offer, and counterparty. While necessary for offline applications, online submissions transmit data directly to exchanges via brokers or banks.
Each form boasts a distinct application number and facilitates entry of intermediary stamp/code/serial numbers.
Investors can procure IPO application forms in PDF format from the BSE and NSE websites.
IPO Application Number
Each IPO application receives a distinct identification number crucial for tracking its progress and allotment status.
Online submissions prompt immediate generation of the IPO application number upon transmission to the exchange through banks or brokers (10:00 am to 5:00 pm).
Paper applications feature a pre-printed IPO application number labeled as Bid cum Application form No. on the application form.
IPO Application Guidelines
- One application per PAN card is permissible.
- Ensure IPO payments originate from the applicant’s own bank account to prevent rejection; third-party payments might be accepted in certain scenarios.
- Exchanges only acknowledge and validate applications upon successful debit or lien placement.
- UPI service caters exclusively to retail investors.
- ASBA Facility extends to all investor categories, including retail, non-institutional, and qualified institutional buyers, except anchor investors.
- Cut-off price IPO applications are restricted to retail investors.
IPO Application Validity
| Ways to Apply in IPO | IPO Bidding Rules |
| IPO application from two Demat accounts | Not Permitted |
| IPO application on the same name | Not Permitted if using different bank accounts |
| from different bank accounts | |
| IPO application from a joint bank account | Permitted, given the applicant is the primary holder |
| IPO application through Google Pay | Permitted via UPI |
| IPO multiple applications under the same | Not Permitted |
| name in a single IPO | |
| IPO application through WhatsApp | Permitted if provided by your broker |
| IPO application through PhonePe | Permitted via UPI |
| Duplicate IPO application | Not Permitted |
IPO Application Status
Investors can track their IPO application status once bids are submitted to the exchange.
For online bids via brokers, check status on the broker’s platform. For offline bids, contact the broker/bank.
Status may include:
- Application processing
- Application executed
- UPI mandate pending/approved
- Payment received by bank
- Bid submitted
Check status on NSE/BSE websites. NSE provides a verification tool requiring PAN registration. The details remain available for 6 days after the IPO closes.
BSE also offers an online status check. Enter issue name, application number, or PAN, verify as not a robot, and submit.