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This article explains how IPO allotment works and guides investors through checking their allotment status, understanding influencing factors, and navigating each stage of the IPO process.
Understanding how IPO allotment works is essential for investors who participate in public offerings. From submitting an application to checking whether shares have been allotted, each stage follows a structured and transparent process overseen by the registrar and market regulators.
This article explains what IPO allotment means, the factors that influence allocation, and the steps involved in the complete IPO timeline. It also guides investors on how to check their allotment status through various platforms and offers practical tips to improve their application experience.
Key Takeaways
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IPO allotment is the process through which shares are distributed to investors based on subscription levels and regulatory guidelines.
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Investors can check allotment status through the registrar’s website, stock exchanges, or broker platforms using PAN, application number, or Demat details.
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The IPO process follows a structured timeline, including issue opening, allotment finalisation, refund initiation, share credit, and listing.
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Factors such as oversubscription, investor category, and basis of allotment influence the likelihood of receiving shares.
What is IPO?
An initial public offering is a process through which a private company raises funds by issuing fresh shares to the public. When a private company issues shares for the first time it is known as an initial public offering. The process is known as follow-on public offering if a public company issues additional shares after an initial public offering. The fresh equity issued by a company during an IPO is bought by investors, which makes them partial owners of the company. The funds raised through an IPO can either be used for expansion or by existing owners and shareholders to book partial profit on their investment. The shares issued as part of an IPO can be traded in the secondary market after listing.
Issuance to IPO allotment, the journey involves several steps. When the finalisation is complete, the issuer releases IPO allotment status where investors can check the allocation against their names.
How to Invest in an IPO?
IPOs attract attention from a wide variety of investors. Investors ranging from small retail investors to large financial institutions buy shares through IPOs. However, not all IPOs give instant returns as some stocks list below the issue price.
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The first step is to determine if a company is worth investing in. Read a company’s draft prospectus, which is available on the website of the Securities and Exchange Board of India, to know about the company’s business plan and financial metrics.
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If you are convinced to invest after reading the draft prospectus, arrange the funds. You cannot bid for a single share, as shares are allotted in lots in an IPO. Investors are informed about the lot sizes in advance. For instance, a company announces a price band of ₹100-110 per share and a minimum lot size of 100 for its IPO. If you bid at the upper limit of the price band, also known as the cap price, you will have to invest at least ₹11,000. The unit for investment in an IPO is a lot consisting of a certain number of shares and not a single share.
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One needs to have a demat account to invest in an IPO. Having a trading account is not compulsory, but without it, you would not be able to sell the allotted shares in the secondary market.
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Applying for an IPO is the next step. Both offline and online mediums are available for IPO Contrary to the older process, where investors had to submit cheques or demand drafts. The market regulator has made the Application Supported by Blocked Amount facility compulsory for IPOs. An amount is blocked in your bank account according to the number of lots requested. An amount to the extent of shares allotted is debited from the bank account after the allotment of shares.
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The allotment of shares takes place after the application process. Not everyone may receive the number of lots requested, as sometimes the demand outstrips the number of shares available.
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The allotment is generally done on the next day after the subscription period ends in accordance with the T+3 timeline.
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One can check the allotment status through the website of the registrar. Registrars are independent institutions responsible for managing the IPO They process the application forms and also take care of the share allotment. Besides the website of the registrar, you can also check the IPO allotment status on the websites of NSE and BSE. Depositories like NSDL and CSDL, stock exchanges, and even brokers inform the investor through email or SMS about the allotment status. You will require the PAN and DPID/ client ID number or the bid application number to check the allotment status.
Also Read, Difference Between NSDL and CDSL
What Is IPO Allotment?
IPO allotment is a process where the registrar of the office allocates IPO shares according to the bids placed by individual investors. Where the shares are oversubscribed, a condition where more bids are placed than the number of IPO shares available, the allotment happens through lottery. Based on the result, shares get assigned to your name.
In the case of large-cap IPOs, completing the IPO allotment process also takes the same time, i.e., T+3 days. The registrar updates the allotment status on its website, where investors can check application status.
How To Check IPO Allotment In Your Name?
When a company announces IPO release, it also declares a tentative IPO allotment date. It is the date when IPO allotment status is disclosed to the public. Nowadays, IPO allotment status gets updated online. To know the status of your bid, visit the registrar’s website. You will have options to search by entering your PAN, DP ID, or application number. If you’ve applied through a broker, you can also check the status by logging in to their app or website.
What are the Factors Affecting IPO Allotment?
Several key factors determine whether an investor receives shares during IPO allotment, including:
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Level of Subscription: When an issue is oversubscribed, especially in the retail or institutional categories, the probability of receiving shares decreases, and allotment is often carried out through a lottery system.
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Allotment Size: The allotment size also matters, although in the retail category, the objective is usually to allot at least one lot to as many applicants as possible rather than multiple lots to a few.
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Investor category: The category in which an investor applies influences the pool of shares available, as specific proportions are reserved for retail individuals, non-institutional investors, and qualified institutional buyers. Larger issue sizes may increase the chances of allocation because more shares are available for distribution across categories.
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Basis of Allotment: It is determined by the registrar and stock exchanges and plays a central role. It outlines whether allotment will be proportional, lottery-based, or a combination, ensuring fairness and compliance with regulatory guidelines.
How to Increase Chances of IPO Allotment?
IPO share allotment is done in accordance with SEBI rules. In case of oversubscription, the registrar, following SEBI rules, will decide the maximum number of retail investors who will receive IPOs by dividing the total number of shares available for Retail Institutional Investors (RII) by the minimum bid lot, after eliminating technical rejection.
Since registrars follow a lottery system to allot IPOs, here is something you can do to increase your chances.
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SEBI has instructed to give equal status to all RI applicants with a value less than Rs 2,00,000. So, there is no perk for submitting large volume application
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Try applying using multiple DEMATs, tied to different PAN
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Bid on the higher end to increase your chances. Bidders ready to pay the cut-off price are given preference
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Check IPO allotment status of HNI, QIBs, and retail category during the 1st and 2nd day to test market response. If the response is good, go ahead with your application.
As per the SEBI regulations, retail investors can invest a maximum of ₹2 lakhs with no minimum limit.
The Complete IPO Process
The IPO process is a structured sequence that enables a company to raise capital from the public and ensures transparency for investors. Each stage follows regulatory timelines set by SEBI and the stock exchanges, allowing applicants to track the progress from issue opening to listing. Understanding the IPO process helps investors anticipate key dates and manage expectations regarding allotment, refunds, and share credit.
Key Stages in the Process:
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Issue Open Date: The window during which investors can submit their applications.
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Issue Close Date: The final day for submitting bids.
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Basis of Allotment Announcement: The registrar finalises allotment and verifies application details by T+1.
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Refund Initiation: On T+2, funds are unblocked or refunded for unsuccessful or partially allotted applications.
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Share Credit Date: Allotted shares are credited to Demat accounts by T+2.
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Listing Date: On T+3, the shares are listed on the stock exchanges and become available for trading.
How to Check IPO Allotment Status?
Investors can check IPO allotment status once the registrar completes the basis of allotment and publishes the results. This process enables applicants to verify whether they have received shares, the quantity allotted, and whether any blocked funds will be released. To check the status, investors must keep their PAN, IPO application number, or Demat account details readily available.
There are several ways to check IPO allotment status:
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Registrar’s Website: Enter your application details on the official registrar portal.
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Stock Exchange Websites: NSE and BSE allow investors to view allotment results by providing basic identification details.
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Broker Platforms: Many brokers display allotment updates within their mobile and web applications.
After completing the steps, investors can see if they are allotted, partially allotted, or not allotted, and monitor refunds or share credits accordingly.
Important Tips for Investors
Investors should adopt a disciplined approach when applying for IPOs. It is essential to study the company’s financials, business model, and risk factors before making a decision. Reading the Red Herring Prospectus helps assess the firm’s fundamentals and future prospects.
Applicants must ensure that sufficient funds are available in the bank account linked to their Demat for smooth ASBA processing. Using a reliable and regulated platform reduces the likelihood of technical issues during the application.
After applying, investors should track key dates such as issue closure, IPO Allotment Status, and listing to stay informed. Maintaining accurate personal and Demat details also prevents application rejection.
How to Check your IPO Allotment Status on the Angel One Mobile App?
If you have recently applied for an IPO via Angel One, here’s how you can check your Allotment Status from our Mobile App:
Step 1: Log in with your 4-Digit Pin and go to the Home tab
Step 2: Choose the IPO section
Step 3: Click on the IPO Orders tab
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Allotted – means that you have been given a full allotment.
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Partially-Allotted – means that you have been allotted fewer shares than you have applied for. For example, you may have applied for 10 lots of ABC IPO. However, you have been allotted only 7 lots; 3 have not been allotted.
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No Allotment – means that you have not been allotted any shares. This may happen because:
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Your application was not selected in the draw or
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There is an error in your PAN No. or Demat account number, or
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Your bid is below the issue price or
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You may have submitted multiple applications under the same PAN.
For No-Allotment or Partial Allotment, any blocked amount will be unblocked/released on or before the UPI mandate expiry date as per the IPO timeline. Please reach out to your bank in case funds are not unblocked/released after the mandate expiry date.
Here are two additional ways to check your IPO Allotment Status:
1) Visit the Website of the Exchanges
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Go here for BSE -> Select Equity -> Select Issue Name -> Enter Application Number & PAN
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Go here for NSE -> One-time Registration
2) Visit the Registrar’s Website
In case you would like to know more about IPOs, continue reading…
Just like living organisms require nutrients to grow, companies need funds to grow. Companies arrange funds through various means. They use profits to fund growth or take a loan to finance expansion. Besides debt and profits, companies also issue equity shares to raise funds from the public. When a company issues its shares for the first time, it is known as an initial public offering or IPO. In 2022-23, 37 Indian companies raised ₹52,116 crore through main board initial public offerings (IPOs).
Also Read, How To Find Demat Account Number & DP ID?
Conclusion
The stellar performance of some recent IPOs has increased retail investor interest in public offerings. The shares of a company list on the stock exchange within days of allotment. You can either choose to hold the shares or simply sell on the day of listing depending on your risk tolerance, investment horizon and liquidity needs.