How to Apply For an IPO?

Learn how to apply for an IPO and invest in the stock market. Understand the eligibility criteria and the application process of an initial public offering. Start your investment journey today.

Initial Public Offering (IPO) is the process by which companies raise funds from the market. Businesses require funds for a variety of reasons like an expansion of the business, debt repayments, an exit strategy for early investors, etc. All these funding requirements can be met through an IPO. As an investor what you need to understand is how to apply for an IPO and, more importantly, how to do it online.

Also Read More About what is ipo?

Steps To Apply for an IPO

You can bid for IPOs through the offline method or online methods:

  • In the offline method, you need to fill out the physical form and submit it to the IPO banker or to your broker.
  • In an online method, you can apply directly through your broker’s website or mobile application. The advantage of the online IPO is that most of your data is automatically populated from your trading or demat account thus reducing the clerical effort from your side. That largely simplifies the online IPO application form fill-up process.

How To Apply for an IPO Online Through Angel One?

  • Login to the Angel One App or website and click on ‘IPO’ on the homepage.
  • Select the IPO you are interested in.
  • Go through the IPO details like maximum quantity, maximum investment, about the company, etc.
  • Click on ‘Apply Now’ to apply and enter the number of lots and bidding price along with your UPI ID.
  • Confirm your bid and accept the payment mandate sent to your UPI App for successfully completing the IPO application.

That’s it! Your IPO order is placed. You can check the status of your IPO in the ‘Order Book’ section.

How To Apply for an IPO Online Through Angel One?

Who Is Eligible To Invest in an IPO?

Technically speaking, any adult who is competent to enter into a legal contract is eligible to apply for the IPO of a company. Of course, it is essential that you have a PAN card issued by the Income Tax department and you also have a valid demat account. Remember, having a trading account is not necessary in the case of IPOs, a demat account alone is sufficient.

However, if you want to sell the shares on the listing then a trading account will be required. That is why brokers will advise you to open a trading account along with a Demat account when you apply for an IPO for the first time.

An important point to remember here is, when you apply for an IPO, it is not an offer but an invitation to offer. Once an investor submits a bid for an IPO, the company and underwriters review the bids received. The allotment process follows, where the number of shares to be allocated to each investor is determined based on various factors such as demand, subscription levels, and allocation rules.

Once the shares are allotted, the investor’s bank account is debited for the amount of shares allocated, and the shares are credited to the investor’s demat account. The investor becomes a shareholder of the company and can participate in its future growth and dividends.

New Offer vs Follow-on Public Offer vs Offer-For-Sale

While applying for an IPO, it is essential to know about a few related key terms that you might have come across:

  • New Offer: If a company is raising funds from the IPO market for the first time and getting the stock listed, then it is a new offer. This offer leads to a listing and the expansion of the capital base of the company.
  • Follow-on Public Offer (FPO): A company is already listed on the stock exchanges but is looking at the IPO market for raising additional funds.
  • Offer-For-Sale (OFS): Here the existing promoters and anchor investors hive off part of their holdings through an IPO. Most of the disinvestments undertaken by the government are in the form of offers for sale. In an OFS, the share capital of the company does not increase but it is only the ownership pattern that changes. An OFS is often used by companies to also list the company in the bourses.

Types of IPO

There are two types of IPOs – Fixed Price IPOs and Book Built IPOs:

  • Fixed Price IPO: Here the company fixes the IPO price in advance as the sum of the par value and the premium. You can only apply for the IPO at that price.
  • Book Built Issue: The company will only provide an indicative price range for the IPO and the final price of the IPO will be discovered through the book-building process. Nowadays, most IPOs are predominantly through the book-building route only.

Under the book-built method, the basis of allotment is finalised within 10-12 days and the demat credit also happens within a couple of days after that. Once the shares are in your demat account and the stock is listed on the exchanges, you are free to sell the shares. As stated earlier, you need a trading account to sell these shares.

IPOs have three classes – Retail, HNI, and Institutional categories. Investments up to ₹2 lakh in an IPO are classified as retail investors. It is beneficial to invest in the retail quota because the allotment methodology is designed by SEBI to ensure that as many retail investors as possible get allotment. Thus, your chances of allotment are much higher in this case. In the case of HNIs, the allotment is proportionate while in the case of institutions, the allotment is discretionary.

Key Point To Remember While Applying for an IPO

There is a very important aspect you need to understand about applying for IPOs. SEBI has now made available a facility called the ASBA (Applications Supported by Blocked Amounts). The advantage of an ASBA IPO is that you do not have to issue a cheque or pay any money for the IPO till the allotment is made.

The amount to the extent of your application is blocked from your bank account and on the allotment day, the amount will be debited only to the extent of the shares allotted. That means if you applied for shares worth ₹1.50 lakh and you got an allotment for only ₹60,000, then only ₹60,000 gets debited from your account and the block on the remaining amount on your bank account is released.


Before applying for an IPO, it is crucial to evaluate the companies carefully and note the advantages and potential risks associated with them. As mentioned earlier, you need to hold a Demat account to apply for an IPO. Open a Demat account for free on Angel One and get started with your investment journey.

How to apply via ABMA App :

How to apply via Web Platform :


Is buying IPO a good idea?

It is a good investment option, but you must know that not every IPOs are worth investing. Here are a few things to remember while considering an IPO.

  • Do a complete background check
  • Read the prospectus carefully
  • Pick companies that are backed by reliable underwriters
  • Get clarity over vividness bias. IPOs can create an illusion of strong performance, long-term success, and such. Get the facts before investing
  • Wait for the lock-in period to get over


What is the IPO issue price?

Offering price or issue price is the price at which IPOs are floated in the primary market.

When can I buy an IPO stock?

You can buy IPOs when they are launched in the primary market, or when they are traded like stocks in the secondary market.

Can you buy an IPO before it goes public?

Yes, you can. One advantage of it is that you can buy shares at a fixed price. You can ask your broker to find an advisory firm that specialises in pre-IPO sales.

How do I get a new IPO?

Finding potential IPOs to invest can be a challenge. But if you are interested, you can find hints in equity market websites, by searching in Google News with search words like IPO, or by following broking houses’ websites.

Can I apply for IPO twice?

No, you can’t apply for IPOs multiple times. If it is discovered that you have applied multiple times with the same name, PAN number, and same DEMAT account your application will get rejected.

Is UPI mandatory for IPO?

No, it isn’t mandatory, but you can now apply for IPO using UPI id. UPI is accepted as a new medium of applying for IPO by SEBI.

How can I increase my chances of an IPO?

The current formula to allot IPOs is to divide the total number of shares available to retail individual investors (RIIs) by minimum bid lot. If you have found a potential deal, you can increase your chances by adopting the following steps.

  • Large bids are ineffective unless more than Rs 200,000 in volume
  • Use different DEMAT account to submit multiple applications
  • Choose cut-off bids over price-bids to increase your chances
  • Don’t file applications at the last moment
  • Avoid your application getting rejected for names mismatch, spelling mistakes and other technical errors

How can I buy IPO offline?

The online process has made it easier and fast to apply for IPOs, but if you still want to apply offline here is what you need to do.

  • Get IPO application form from a broker or download it from NSE/BSE website
  • Fill in the form with required details such as – bank details, DEMAT details, Pan Card No., and cut-off price
  • Submit the application with your broker or a bank with ASBA (Applications Supported by Blocked Amount) facility