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What is price discovery?

Based on demand at various prices, Issuer Company, in consultation with BRLMs decides the final price of the offer. The price thus finalized is called discovered price.

What is the meaning of a bid?

A bid in the context of Public offer of shares, is offer made by investor to the issuer for requisite quantity of securities at a price. The investor can choose any price within the specified price band of the issue. The price at which he wants to apply is the bid price. A bid is applicable only in case of book-building IPO.

Can an investor apply in an IPO through multiple applications with the same name?

No, one person cannot apply multiple times with the same Demat/PAN for an IPO. If an investor applies in an IPO through multiple applications with the same Demat account or same PAN Number, his/her application will be rejected.

Can I Apply for an IPO Through Multiple Applications on the Same Name?

No. You cannot apply in an IPO through multiple applications with the same name. If an investor tries doing it, then all the applications made under the same name will be rejected. Another way of doing this is to apply in the name of different family members. Just remember that the applicant should have a Demat account and PAN.

Can I revise or withdraw the bids after applying in the issue?

Yes, the investor can revise or withdraw the bids only once the order is accepted. The investor needs to go to the IPO Order Book and select the order status and then click on modify to revise the bid and click on cancel to withdraw the Application/ Revise Bid.

Can You Sell the Stocks Before the IPO gets Listed?

No, you can sell the shares only after the IPO shares are listed on the exchanges.

How are investors categorized?

a) Qualified Institutional Bidders (QIBs) - who are the domestic and foreign institutions (which are registered with SEBI) which are eligible to apply in the public offers. These institutions normally apply for very large amounts.b) Retail Investors - The investors who invest up to maximum of Rs.2,00,000 (Rs. Two Hundred Thousand), are defined as Retail Investors.c) Non Institutional Investors - Those Investors who are neither in the QIB Category nor in the Retail Investor Category are defined as Non Institutional Investors.Note: In some IPOs a certain number of shares issued are reserved for employees of the issuing company.

How can you check the status of IPO Application on the web site?

To know the status of alotment kindly click here. Click on and you would get the page. Select the desired company. Choose the option depending on whether your account is with NSDL or CDSL. Enter the details as per the option whether you want full details or only allotment details. Submit the same, and within moments the results would be displayed to you on the screen.

How Different is QIB From an Anchor Investor?

First, an Anchor Investor falls under the category of a Qualified Institutional Buyer or QIB. Here are some differences: The Anchor Investor needs to apply for shares worth more than Rs.10 crore The bidding price is different for anchor investors and QIBs Of the total QIB allocation, up to 60% can be reserved for anchor investors Anchor investors are not allowed to sell their shares up to 30 days from the date of allotment of the said shares via an IPO.Read moreOne important aspect of an anchor investor is that if the cut-off price is lower than the bid price of an anchor investor, the excess amount is not refunded to them. Since they invest more than Rs.10 crore, their participation encourages smaller investors to apply.

How much money is blocked in my bank account?

Investors can place up to 3 bids in an IPO application. For instance, the price range of an IPO is Rs. 100 to Rs. 120. investor can place the following bids:Bid 1. 10 shares at Rs. 100Bid 2. 15 shares at Rs. 110Bid 3. 20 shares at Rs 120In the above scenario, the blocked amount is the highest of the three bids. The highest bid amount shall be Rs 2400 (10*110= 1000 ,15*110 = 1650, 20*120 = 2400 ). Hence, Rs 2400 shall be blocked.

Till what time shall my money be blocked in IPO?

The money will be blocked until the finalization of allotment, post which the amount equivalent to allotted shares would be debited, and the balance amount (in case of partial allotment) will be unblocked.

What are the special points investors should take care of while applying in the IPO

Please ensure your Demat Account Number and PAN is clearly written without any smudging or overwriting. Your payment details like account number in case of ASBA / UPI ID, etc. are clearly written. Your bid is for the proper bid lot and a price within the bid range. The order of names in the application is the same as in your DP account. Kindly ensure that the application form is duly signed.

What are the timings for applying in an IPO?

Order received between 10 AM till 4:30 PM on trading days shall be immediately placed on Exchange and order received after 4.30 PM shall be placed on Exchange on the next day. Timings for the last day of IPO close day, shall be notified on IPO order page.

What do you do if you have been allotted shares, but you have not received the credit to your demat account?

Ensure that your DP account is active and is in a ready state for receiving credits. Provide a copy of your Client Master to Registrar to enable the upload of your allotted shares in your account. A copy can be sent by Email/ Fax/Scanned image.

What is the maximum no. of bids allowed per investor?

An investor can place a maximum of 3 bids in an issue.

What is the Procedure to Withdraw from an IPO?

You need to login to the broker’s account from where you made the application and go to the order book. Next, you need to select the specific IPO and choose to withdraw. The money that was blocked for the application will be released within a couple of days. However, it is important to remember that you can withdraw only during the bidding period. If the IPO does not have an online withdrawal option, then you need to contact the broker/bank through whom you applied.

What is the role of Registrar in an IPO ?

The Registrar’s role in an IPO can be divided into three phases: Pre-IPO, when the Registrar completes all preparatory work for the IPO, including instructing the escrow / ASBA bankers about the procedures they have to follow and the timelines to which they have to adhere and also informs the said company in regards to the validation of payments. Post-IPO closure but pre Listing –, during which the Registrar receives the Final BID file from the exchanges, validates the same, and coordinates with the bankers to ensure that final collection certificates are received along with bank schedules/data. for reconciliation with final bid files received from Stock Exchanges.Read moreThe Registrar identifies all other technical and multiple rejections. The Registrar after considering all the rejections, and after reconciling the banked bids with the Final Bid file, prepares the basis of allotment in consultation with the BRLMs and Issuer , and submits this basis for approval to the Stock Exchange. Upon approval by the Stock Exchange, the Registrar proceeds with the allotment of shares, ensures that the electronic files for credit of shares and debit and unblocking files to SCSBs are properly prepared and ensures the completion of all these processes within the prescribed time limits.Read morePost allotment / listing phase during which the Registrar attends to all the complaints and strives for speedy resolution of the same.

What is the timeline by which the allotment process is to be completed ?

As per current norms, the equity shares issued in IPO / FPO have to be listed, on or before the 6th working day after the issue/ offer is closed. The revised timeline is as per the SEBI Circular dated August 09, 2023, bearing reference no: SEBI/HO/CFD/TPD1/CIR/P/2023/140. it has been decided to reduce the time taken for the listing of specified securities after the closure of public issue to 3 working days (T+3 days) as against the present requirement of 6 working days (T+6 days); ‘T’ being the issue closing date. On a voluntary basis for public issues opening on or after September 1, 2023, and - Mandatory for public issues opening on or after December 1, 2023. 

When can you trade in the new shares?

You can trade in new shares after they are listed and after ensuring that the allotted shares have been credited into your Demat Account. As per current rules, you cannot affect any off market transfers from your account till the shares are listed.

Who is a BRLM?

A BRLM is the Book Running Lead Manager, who manages the entire IPO exercise and acts as the guide to the issuer in all matters relating to the public issue. The BRLM, should be a SEBI- registered Category I or II Merchant Banker, and is responsible for preparing and filing the Offer Document of Issue with SEBI & Registrar of Companies (ROC).The BRLM ensures that all information presented before the investing public is proper. The BRLM advises the company on the price band, the timing of the issue etc. BRLM is required to market the issue. The BRLM also co-ordinates between the company and other intermediaries like registrars, legal advisors, bankers etc.

Who is a registrar to the Issue?

A Registrar to an Issue is a SEBI-registered entity, qualified to act as such, and who electronically processes all the applications and carries out the allotment process, as per the rules/prospectus. The Registrar is responsible for complying with the time deadlines of updating the electronic credit of shares to the successful applicants, dispatching/uploading of refunds and attending to all investor related queries after the issue is completed. Usually, the Registrar continues to work with the company, even after the IPO, as its Registrar and Transfer Agent.

Who is a Sponsor Bank ?

The Banker to the Offer registered with SEBI, which has been appointed by the Company to act as a conduit between the Stock Exchanges and NPCI in order to push the UPI Mandate Request and/or payment instructions of the Retail Investors using the UPI and carry out other responsibilities, in terms of the UPI Circulars

Who is a Syndicate Member/Broker?

A Syndicate Member/Broker is a member of the Stock Exchange to whom the investor must submit the IPO Bid/Application form. The Syndicate Member / Broker receives the bid and uploads the same onto the electronic book of the stock exchange. Bids that are not uploaded into the electronic book are not considered for the purpose of allotment. The Syndicate Member/Broker then submits the bid with application to the Self Certified Syndicate Bank (SCSB) physically or through UPI mode. In the case of an online application, the Syndicate Member/Broker generates the electronic application form and submits the same to the registrar with proof of having paid the bid amount.

Why does the credit of shares not happen?

Credit to your demat account does not happen, if a) Your demat account is not active and there is a bar on accepting credits to your account. b) Your demat account number is not accepted by the system as a result of mismatch of data. c) Your demat account as provided in bid file is erroneous.

Why is a demat account necessary for applying in an IPO?

As per SEBI guidelines shares allotted out of IPOs / FPOs can be given to investors only in demat mode hence it is mandatory to have demat account. Application not having demat account or improper demat account is rejected.

Why is PAN important?

As per SEBI guidelines, all applicants are required to provide their PAN while applying in an Issue. Application without PAN or with invalid PAN is rejected. Investors are requested to ensure that their DP account is updated with proper PAN details.

Why is the Maximum Subscription Amount for Retail Investors Limited to Rs 2 lakh?

SEBI has classified investors into three broad categories – RIIs, NIIs, and QIBs. It has also mandated companies to reserve a fixed percentage of the IPO to each category as shown below: RII – Retail Individual Investor – 35% of the IPO NII – Non-Institutional Investor – 15% of the IPO QIB – Qualified Institutional Bidder – 50% of the IPO study.Read moreSEBI decided to cap the investment amount at Rs.2 lakh for an investor to qualify as a retail investor. The benefit of applying as a retail investor is that SEBI governs the allotment methodology in this category and ensures that a maximum number of retail investors receive the allotment. On the other hand, in the case of NIIs, the allotment is proportionate and for QIBs it is discretionary. To ensure that the shares reach the mass

Why is your Demat Account No.(DP-ID & Client-ID) Important?

The DP-ID + Client ID, is the definitive identification of the applicant. Demat account fed into electronic bid file, is used to credit shares as well as remit refund. Registrar is required to process application based on bid file and in absence of any other possible validation, wrong but valid demat account, can lead to wrong refund / credit of shares. bid file, Thus it is very important that the Demat Account Number is stated correctly in the application form.

Are all categories of investors eligible to apply in public issues using UPI for payment?

No. Only individual investors are allowed to use UPI for payment in public issues as Retail Investors and Non-Institutional Investors.

Are Karta/HUF and Minor account holders are eligible to access UPI in ASBA facility?

SEBI circular only specifies that applications made by retail individual investors using third party UPI id or by any category of investors using a third party bank account are liable for rejection.SEBI has not restricted any individual investor from accessing UPI in ASBA facility based on mode of operation of investors account.While some banks allow to create UPI Id for Karta/HUF and minor accounts, it is within the bank’s discretion to decide whether Karta/HUF/minors will be allowed to create the UPI id. However, SEBI has facilitated that the IPO applications including those from Karta/HUF and Minor accounts can be submitted directly to the ASBA banks.

Are second / third / joint account holders in a bank account restrained from using the same account for payment in public issues?

No specific restriction has been imposed by SEBI on use of bank account by second/third/joint holder. However, third party applications will not be considered valid for allotment.

Can I apply in a public issue using UPI ID with my Account +IFSC?

No. The investors must apply by providing their UPI ID only, on which the request for blocking the amount shall be received.

Can I apply on the first day of an IPO using UPI and decline on the last day?

Yes. The investor can decline the mandate transaction on the last day provided he/she have not accepted the UPI mandate successfully. In case mandate is successfully accepted, the investor can withdraw/delete/cancel the application by approaching the intermediary through which the original application was submitted. Alternately, theinvestors can choose to not act on the mandate which expires automatically on T+1 (T: Issue Closure Date) at 12:00 PM.

Can I modify the parameters, like bid quantity, price, amount, etc., when I receive a block request in public issues?

No, the values in the block request cannot be modified on the UPI application. Any modification to the bid details, including the amount, has to be undertaken by approaching the intermediary to whom the application form was originally submitted. Upon modification of bid amount by the intermediary, you will receive a fresh mandate block request with revised amount, which needs to be again authorized by entering your UPI PIN. Intermediaries providing the web/mobile interface also provide the modification option on their platform.

Can I use a third party UPI ID or a third-party bank account for making payment in FPO?

No, applications made by retail investors using third party UPI ID or by any category of investors using a third-party bank account are liable for rejection.

Can I use my existing UPI ID for applying in public issues?

The bank account associated with the UPI ID is held with a bank whose name is appearing in the ‘List of SCSBs eligible to act as an Issuer Bank’ available on website of SEBI.The investors shall be using a mobile application and a UPI handle that supports use of UPI for public issues. A list of such applications and handles appears in the ‘List of Mobile Applications for using UPI in Public Issues’ available on website of SEBI. Investors, whose bank is not providing the UPI Mandate facility, may use the other alternate channels available to them viz. submission of physical application form with Self Certified Syndicate Bank or using the facility of linked online trading, demat and bank account.

Can I use third party UPI ID or a third party bank account for making payment in public issues?

No. Applications made by retail investors using third party UPI id or by any category of investors using a third party bank account will not be considered valid for allocation.

How can I apply for an IPO using UPI as a payment option?

Investors need to fill in the bid details along with their UPI id linked to his/her own bank account

How can “UPI as a payment option” be used in the public issue process”?

UPI as part of biddingInvestor can fill in the bid details in the application form or the mobile device / web interface of the intermediary along with his/her UPIID. As per the existing process, investor may submit the application or fill in the bid detailson the mobile device / web interface with any of the intermediaries (Syndicate Member / Registered Stock Brokers / Registrar and Transfer Agents / Depository Participants), who, on receipt of application will upload the bid details along with UPI id in the stock exchange bidding platform.The stock exchange will electronically share the bid details, along with investors UPI id, with the Sponsor Bank appointed by the issuer company. Read moreUPI as part of blocking of fundsThe Sponsor Bank will request the investor to authorize blocking of funds equivalent to application amount and subsequently debit the funds in case of allotment.The request raised by the Sponsor Bank, would be electronically received by the investor as an SMS/intimation on his / her bank provided mobile no./mobile app associated with UPIID. Upon validation of mandate fund block request by the investor by entering his UPI PIN, the said information would be electronically received by the investors’ bank, where the funds, equivalent to application amount, would get blocked in investors account.Intimation regarding confirmation of such block of funds in investors account would also be received by the investor.

How do I know that my modification mandate request is successful?

Once the successful modification is done, a confirmation will appear on the UPI mobile application.

How do I select UPI as the payment option while applying for public issues?

The application form for an IPO, now also includes a field for entering your UPI ID as a payment mechanism. Further, Investors can get in touch with any of the intermediaries who shall be able to guide them on the process in detail.

How is public issue application using UPI different from public issue application using ASBA submitted with intermediaries?

Public issue application using UPI is a step towards digitizing some of the offline processes Involved in the application process by moving the same online. This requires an investor to create a UPI ID and PIN using any of the UPI enabled mobile applications of SCSBs. The UPI ID can be used for blocking of funds in the bank account and making payment in the public issue process. An investor can accept the request to block the funds for the amount bid by entering the UPI PIN in his/her mobile application. The money shall be Blocked and shall be automatically remitted to the Escrow Bank, in case of allotment. In case of non-allotment, the funds shall be unblocked by the SCSBs. UPI in public issue process will essentially bring in comfort, ease of use and reduce the listing time for publicissues.

In what scenarios will my funds be unblocked?

The money in the investors account will be unblocked in case the allotted shares are less than the bid quantity, or in case of an unsuccessful application or in case of revocation of a block request. Further, in case of cancellation of the bid post successful mandate block is created, the funds shall be released online.

Is It Possible to Apply for an IPO Using the BHIM Application?

Yes, SEBI has permitted the use of UPI ID (that can be created by using BHIM application) for IPO application. At the time of filling the application form, you need to specify your UPI ID and submit it. The broker will send a request for blocking the funds to your UPI mobile application. You need to log in to the application and approve the block mandate. The amount applied for will be blocked in your bank account Post blocked in your bank account. Post allotment, the exact amount will be debited (based on the allotment) and the excess amount will be unblocked.

Is there any timeline by which I need to act upon the block request?

Yes. As per the indicative activity wise timeline prescribed in the SEBI Circular dated November 01, 2018, all block/collect requests which have not been acted upon by 12.00 pm on T+1 working day i.e. one working day after closure of the issue, would lapse.

Is use of UPI, as a payment mechanism in public issues, mandatory?

Yes. UPI mechanism is mandatory for all applications made by individual investors through the intermediaries, provided the application amount is upto Rs.5 Lakhs.

Till what time can I authorize the modification request for parameters like bid quantity, price, amount etc?

All modification requests initiated can be acted upon before 12:00 pm on T+1 working day i.e. one working day after closure of the issue.

Till what time will the amount remain blocked in my account in the public issue process?

The amount will be blocked till the finalization of allotment, post which the amount equivalent to allotted shares would be debited and balance amount (in case of partial allotment) will be unblocked by the SCSB. In case the amount is not unblocked post the finalization of allotment, you may approach your bank and request them to unblock thefunds manually.

Till when can I revoke a block request?

A mandate request once created can be revoked during the issue period till closure of the issue. The revoke can be initiated through the intermediary with whom the application was submitted. Intermediaries providing the web/mobile interface also provide the modification option on their platform.Investors should not approve a mandate block request post cancelling the bid on the exchange platform. This shall result in delay in releasing the funds blocked in the bank account.

Unblocking of funds through ASBA / UPI modes?

The latest SEBI Circular ,mandates SCSBs to ensure that the unblock process for non-allotted/partially allotted applications is completed by the closing hours of one Working Day subsequent to the finalisation of the Basis of Allotment. In case the funds are still blocked in the applicants accounts, they can approach the respective SCSBs/ Registrar to ensure their funds are unblocked immediately.

Up to what limit can I apply for a public issue inUPI?

The limit for an IPO application made by individual investors through UPI is Rs. 5 Lakhs. However, the retail individual investors limit shall continue to be upto Rs. 2 Lakhs. Thus, the applications where the application amount is greater than Rs. 2 Lakhs and upto Rs. 5 Lakhs shall be considered under Non Institutional Investors category.

What does revoking a block request mean?

Revoking a mandate request is cancellation of a block request pursuant to cancellation of an IPO bid.

What happens if I change my default account before execution i.e. settlement of the block request?

Execution of the mandate is independent of the default account and will be executed against the same account which was linked at the time of creating the mandate.

What happens if I change my UPI ID after my amount is blocked / modification of mandate / before execution of block request for IPO?

Execution of the mandate request / block request is independent of the UPI ID and will be executed against the same account which was used at the time of creating the mandate irrespective of the fact that the UPI id was changed at a later stage.

What happens if I deregister from the UPI App after accepting the block request?

De-registration will not be available from the application until the active requests are revoked /executed.

What happens if I do not authorize the modification request?

Post the expiry time of the modification request, the modification request would lapse and the execution will take place based on the earlier approved request / mandate which shall remain active on the original application.

What happens if I do not get any shares but my money is debited in this process?

In case no shares have been allotted and money is debited from the investors account, you may raise a complaint along with the application details, either from the UPI App or approach the bank / RTA / Merchant Banker / the intermediary with whom the application was submitted.

What happens if I do not get any shares but my money remains blocked?

In case no shares have not been allotted to the investor and money is not unblocked / reinstated in the account, the investor may raise a complaint through the UPI App or approach the Merchant Banker/ SCSB / RTA with whom the application was submitted.

What happens if I do not receive the shares and my amount is also not debited?

The investors money shall be unblocked/reinstated to the account with the expiry of the mandate period in case shares are not allotted to the investor.

What happens if I don’t get a block request from the intermediary on the UPI id that was entered in the application form?

In such a case, the investor may approach the same intermediary to whom the application form was submitted for re-initiating the process. The investor may also like to check whether the UPI id recorded is correct or not and that the UPI app is updated/Up-to-date.

What happens if I have not accepted the mandate on my UPI app?

In case you have not accepted the mandate on your UPI app, your IPO application is liable for rejection

What happens if revoking of a block request fails due to technical error?

In such a case, the investors would need to re-initiate the revoke request. Such re-initiation can be done through the intermediary with whom the application was submitted. Further, the bank shall unblock the funds in the bank account in the offline mechanism. Investors should not approve a mandate block request post cancelling the bid on theexchange platform. This shall result in delay in releasing the funds blocked in the bank account.

What if I do not want to proceed with the public issue application after submission with intermediary? Can I withdraw my bid? If yes,how?

As per the extant legal framework, retail individual investors can withdraw bids till issue closure date. During the bidding period you may approach the same intermediary with whom the application form was submitted, for withdrawal of bid. Intermediaries providing the web/mobile interface also provide the modification/cancellation option on their platform.

What if more money is debited than the allocated shares?

In case amount more than allotment value is debited, the investor may raise a complaint with the Lead Manager / bank / RTA / from the UPI App / through any other mode along with Unique Mandate Number and application details.

What if my amount is blocked twice for a single block request?

In such a case, the investor may raise a complaint with the bank/Lead Manager providing the requisite details including the Unique Mandate Number for the unblock request.

What if my bank is not providing UPI service for public issues?

In case the bank is not providing UPI services for public issues, the investors may make use of their bank account for directly blocking of funds and submit the application with the bank, provided it is recognized by SEBI as a SCSB.

What is a UPI ID?

UPIID (also called Virtual Payment Addressor VPA) is a unique ID for using UPI. The UPI Id can be created by registering with one of the UPI enabled mobile applications (App) using the investors bank account details.

What is UPI ?

Unified Payments Interface (UPI) is an instant payment system developed by the National Payments Corporation of India (NPCI), an RBI regulated entity.

What is UPI Mandate request?

A request (intimating the Retail Individual Investor, by way of a notification on the UPI linked mobile application as disclosed by SCSBs on the website of SEBI and by way of an SMS directing the Retail Individual Investor to such UPI linked mobile application) to the Retail Individual Investor using the UPI Mechanism initiated by the Sponsor Bank to authorize blocking of funds equivalent to the Bid Amount in the relevant ASBA Account through the UPI linked mobile application, and the subsequent debit of funds in case of Allotment

Where can an investor submit his UPI application for any grievances in the issue procedure?

Investor should first approach the intermediary to whom the application was submitted. For complaints with respect to blocking / unblocking of funds, investor may approach the bank. For complaints with respect to non-allotment of shares, investor may approach the registrar to the issue. If the investor is not satisfied with the response, investor can approach the stock exchange. In case, where the investor is not satisfied with the response of any of the intermediaries, investors may submit a complaint with SEBI click here

Where can I submit either the electronic or physical application form with UPI as a payment mechanism?

Electronic or Physical Application forms with UPI as a payment mechanism can only be submitted with, a Syndicate Member, or a Registered Stock Broker, or a Registrar and Transfer Agent or a or Depository Participant (‘Intermediaries’). The investor may also use the online facility (if provided) of stock brokers for seamless bidding in IPOs.

Where will I get an option to apply in a public issue using UPI?

Public issue using UPI may be initiated through any of the intermediaries. The UPI id can be given to the intermediary to whom the application form is being submitted. Alternately, the stock broker’s mobile application/web facility can be used for online application submission. All requests for blocking the bid amounts shall be received by the investor, onhis/her UPI id / App. The investor would need to enter the UPI PIN to accept the mandate request for blocking the funds against the bank account.

Who should I approach if I face issues with the block request? My bank or through my mobile / PSP app?

While the request can be re-initiated in case of any technical issues the investor may also reinitiate with another bank account or a different UPI application. In such a case, customer can reach out to their bank/PSP with the Unique Mandate Number (UMN) of the block request.

Will I be notified when the bid is successfully placed?

Yes. Once the bid details are uploaded on the stock exchange platform, the stock exchange shall send an SMS to the investor regarding registration of the bid, on end of day basis or on the next working day. Further, the investor shall receive a SMS notification on the UPI enabled mobile device stating that a mandate block request is received in UPI.

Will I be notified when the shares are allotted?

Under the UPI framework, the investor will be notified of the debit of funds from the bank account. However, the process of communicating the share allotment process shall be separate, as per the extant process.

Will I be prompted to authorize the modified request?

Yes. The customer will receive notification on mobile application as well as an SMS for authorizing the modification request.

Will the existing non-UPI channels for making application in public issues be available for individual investors after introduction of UPI?

Yes. The below channels shall continue to remain for submission of applications by Individual Investors.Directly to SCSBs (Bank ASBA).3-in-1 type accounts (Direct Online).

What is an IPO?

An IPO is an Initial Public Offer made by a company (issuer) offering shares or debentures or other tradable security to the public at large. An IPO is either for a) Fresh issue of capital, where the funds are received by the issuing Company.b) Offer for Sale – where the existing shareholders (usually promoters), sell their holding, in which case the funds do not go to the company but only to the offering shareholders.c) Combination of a) and b) above.

What is Floor price and Cut-off Price?

The floor price is the minimum price at which an investor can place a bid in a book building issue. On the other hand, the cut-off price is the price at which the company allots the shares and the investor agrees to buy it at the said price.

What is ‘Market Lot Size’ and ‘Minimum Order Quantity’ for an IPO?

When a company launches an IPO, it specifies the minimum number of shares that an investor can apply for. This is known as the IPO bid lot or market lot size or minimum order quantity. For example, if a company specifies the minimum order quantity as 100 shares and the investor wants to purchase more than 100, then the application can be made in multiples of 100 only. Hence, the investor can apply for 100 shares, 200 shares, 300 shares, and so on. 

What is the difference between a first time issue (IPO) and a follow-on public offer(FPO)?

IPO comprises of offer for subscription made by such company whose shares are not listed on any stock exchange for trading. Whereas FPO is offer made by already listed company to issue additional securities. For already listed company, investor may decide to buy from the market or subscribe to the offer made by the Company.

What is the difference between Fixed Price Public Offers and Book Built IPO?

Fixed Price Offer, is an issue in which the price of the security offered is fixed by the issuer. Investor is required to make application for the desired quantity of shares at the fixed offer price.. On the other hand, in a Book Built Issue, Price is discovered through the bidding mechanism. Usually, a band (range) of the price is announced, and interested investors apply or bid for the security within this band i.e. the application can be for any price within this range

What is the Difference between Floor Price and Cut- Off Price for a Book Building Issue?

In a book building issue, the company does not determine the final price at which it will allot the shares. Instead, it offers a price range to investors. An investor can bid at any price in the price range decided by the company. The lowest price at which an investor can place a bid is known as the Floor Price. On the other hand, the highest price at which an investor can place a bid is known as the Cap Price of the IPO.For example, if a company launches an IPO with a price range of 250-300, then Floor Price = Rs.250 Cap Price = Rs.300 If the allotment price is Rs.275, then investors who at Rs.275 and above will receive the allotment.Read moreHowever, there is one more option to bid in a book building issue –Cut-off Price. For all practical purposes, this is like bidding at the Cap Price since the investor has to pay the highest price (or Cap Price) while placing the bid. Hence, despite not specifying the bid amount, he will receive the allotment at Rs.275 and a refund of the balance amount.

What is the difference between Public & Rights Issue?

Accredited investors can buy the offered shares without any restriction of their existing holdings. In a rights issue, the company does offer the rights issue of shares through a public offering. In a private placement, the company does not offer their stocks through a public offering.

What is the Difference Between RII, NII, QIB, and Anchor Investor?

When a company launches an IPO, it has various categories under which investors can invest: RII – Retail Individual Investor NII – Non-Institutional Investor QIB – Qualified Institutional Bidder Anchor Investor RII – Retail Individual Investor This is the most common category of investors bidding in an IPO. This category Resident Indian individuals, non-resident Indians (NRIs), and Hindu Undivided Families (HUFs) The maximum amount of investment is Rs.2 lakh A minimum of 35% of the IPO is reserved for the RII category Investors from this category can bid at the cut-off price.Read moreNII – Non-Institutional Investor If an investor qualifies to bid under the RII category but wishes to invest more than Rs.2 lakh, then he falls under the NII category. This category includes:Resident Indian individuals, non-resident Indians (NRIs), Hindu Undivided Families (HUFs), corporate bodies, companies, trusts, science institutions, and societies Investors can invest more than Rs.2 lakh A minimum of 15% of the IPO is reserved for the RII category Investors from this category cannot bid at the cut-off price.Read moreQIB – Qualified Institutional Bidder: This category includes: Mutual funds, public financial institutions, foreign portfolio investors, and commercial banks, etc. 50% of the offer size is reserved for this category Investors from this category cannot bid at the cut-off price.Read moreAnchor Investor : This is a QIB making an application of more than Rs.10 crore in a book building issue. This category includes:Resident Indian individuals, non-resident Indians (NRIs), Hindu Undivided Families (HUFs), corporate bodies, companies,trusts, science institutions, and societies Investors making more than Rs.10 crore application Investors from this category cannot bid at the cut-off price Up to 60% of the QIB category can be allocated to this category.

Can a rights issue application be made through ASBA?

Yes, one can apply for rights like in an IPO through ASBA. However, Please note that all Eligible Equity Shareholders (other than renouncees and holding equity shares in physical form) who are QIBs, Non-Institutional Investors (including all companies and body corporates) and other retail Applicants whose application amount exceeds Rs.2,00,000 can participate in the Issue only through the ASBA process 

Can shareholders holding Equity Shares in physical form apply through ASBA?

Shareholders holding Equity Shares in physical form, are supposed to furnish the details of their demat accountto the RTA or the Company at least two Working Days prior to the Issue Closing Date, desirous of subscribing to Rights Equity Shares after which they can apply through ASBA facility.

How to withdraw an Application made through ASBA?

An Investor who has applied in the Issue may withdraw their Application at any time during the Issue period by approaching the SCSB where application is submitted or sending the email withdrawal request to the registrar. However, no Investor, may withdraw their Application after the Issue is Closed.

Are PAN details compulsory?

Yes, Irrespective of the application amount, PAN is to be compulsorily mentioned in the application form for all holders

Can a joint bank account be used to make applications on behalf of shareholders?

In case of joint holder Applications made through ASBA process, all joint holders must sign the relevant part of the Application Form in the same order and as per the specimen signature(s) recorded with the SCSB. In case of Joint Applicants, reference, if any, will be made in the first Applicant’s name and all communication will be addressed to the first Applicant 

Can an application in the rights Issue be made using third party bank account?

No, Investors can make payment only using bank account held in their own name. Please note that Applications made with payment using third party bank accounts are liable to be rejected. 

Can I apply for additional shares in the rights issue apart from my entitlement?

Yes, applicants can apply for any number of additional shares but the allotment of the same will depend on shares available for apportionment and will also be in proportion to your holding, irrespective of additional shares applied by applicants.

Can I sell the shares on the record date and still get the rights issue benefit?

If you have the shares in your holdings as on the record date, even if you sell on the record date you’ll still be eligible to apply for the rights.

Can the same application form be used both by shareholder or renounce ?

Yes, same application form can be used both by shareholder or renouncee.

Do the investor also has an option to make an application on a plain paper?

In terms of Regulation 78 of the ICDR Regulations, investor also has option to make an application in writing on a plain paper.

For Issuance of newspaper advertisement, as per Regulation 84 (1) of ICDR Regulations, within how many days dispatch shall be completed by the issuer ?

Issuance of newspaper advertisement disclosing date of completion of dispatch and intimation of same to the stock exchanges for dissemination on their websites, as per Regulation 84 (1) of ICDR Regulations, shall be completed by the issuer at least 2 days before the date of opening of the issue.

How do I check Allotment Status for Rights Offer?

Click here to know the status of Allotment under Rights Issue.

How do I make an Application on Plain Paper ?

You can also participate in Rights Issue, by using our link "Application format -Plain Paper".As per the details provided by you in the web portal, the Rights Form shall be mailed to you on the email-id provided.

I am getting an error on the RTA's website - "Details do not exist in Record Date."

If you have purchased REs from the secondary market then try applying under the ‘renouncee’ category.

I don’t have any securities on the record date, can I still purchase REs through my broker account and then buy the shares against the RE?

Yes, you can purchase the REs, and ensure the same are credited on or before Rights Issue Closure and ensure funds are also blocked before the rights issue closes.