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Initial Public Offerings (IPO)

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What Are The Different Ways of Filing An IPO Application?

Now that we have learned the cut-off system in the bidding process from our previous unit let us discuss the different ways to apply for an IPO. 

Investors can apply for an IPO through online mode/offline mode. The SEBI has made it mandatory to issue shares only in the dematerialized form, hence a demat account is an essential pre-requisite so that the shares allotted can be credited to the Investor’s account.

Online Mode:

The most suitable and convenient way to apply in an IPO online is using a 3-in-1 account (bank account, demat account & trading account) offered by banks. 

1. Open a demat account/trading account with a financial institution that provides online facilities to apply for IPO.

2. Login into your trading account and select the IPO you wish to invest in.

3. Transfer funds from your bank account to your trading account.

4. Select the number of shares you want to apply for and the price at which you want to bid for (or use cut off option) and then press the submit button.

5. If the applicant gets allotment, shares will be credited to demat account and the blocked money shall be debited from the account. 

6. In case of non-allotment, the amount is unblocked immediately and is ready to use freely.

What if your bank does not offer ASBA Online?

Step 1: Go to ASBA E-Forms on NSE

Step 2: Select the IPO you want to apply.

Step 3: Click on Bid-cum Application Form Download.

Step 4: Fill up the online form with all requisite information such as the name of the applicant, PAN number, demat account number, bid quantity, bid price, and other relevant details.

Step 5: Download the form.

Step 6: Submit the form to the designated branch along with a photocopy of your PAN Card.

How can one apply for IPOs offline?

This is the traditional way of applying in IPO by filling a physical application:

1. Collect ASBA form, available at the designated branches of the banks approved for providing the facility known as self-certified syndicate bank (SCSB).

2. Fill in the form details such as name of the applicant, permanent account number (PAN), Demat account number, bid quantity, bid price, and other relevant details.

3. Submit the form to their designated banking branch with an instruction to block the amount in their account. In turn, the bank uploads the details of the application in the bidding platform. 

4. Investors must ensure that the details that are filled in the ASBA form are correct; otherwise, the form is liable to be rejected.

5. A photocopy of the PAN Card must be attached for applications greater than ₹50,000

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