How to invest in IPO What is the right way to invest in IPO?

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In the previous information, we have learned about IPO, what is IPO, whether to invest in IPO or not. So in today’s information, we will know about some inside information of IPO. Like what type of people can invest in IPO. How to invest in IPO. And in this information, we will also learn about how to invest in IPO by Jirod Kite.


How to Invest in IPO How to Invest in IPO ?

Friends, investing in IPO is easy. But before investing in IPO, it is very important to know about its complete information about that company and what are the terms and conditions of IPO.

Which People Can Invest in IPO (Which Type Investors invest in IPO)?

Let’s talk about who are the people. Who can invest in IPO? Three categories have been created for investing in IPO. Under which different types of investors come and in which there is also different quota reserve.

1.Retail Individual Investor (RII)

This category of Retail Individual Investor IPO includes small investors such as those with an investment of less than 2 lakhs. Any retail investor can invest at least 2 lakhs in an IPO. At least 35% IPO quota is reserved for retail investors. Let’s say a company comes out with 100 IPOs, out of which only 35 IPOs can be booked by retail individual investors.

2.Non institutional Investor (NII)

This category of non-institutional investor IPO includes those investors who want to invest in IPOs above 2 lakhs. In this, at least 15% quota of IPO is kept in reserve. And in this category people come from who.

  1. HNIUnder this, High Network Individual, if an investor wants to invest in more than 2 lakh IPOs, then he falls in the NII category.
  2. HUF
  3. Corporates

3. Qualified institutional buyers (QIB)

There is a third category of investing in IPOs. Qualified Institutional Buyer, which includes large investors. Like banks, mutual funds, insurance companies and many other big investors come. A maximum of 50% quota is reserved for QIBs in IPL.

  1. Bank
  2. mutual fund
  3. Foreign institutional investor
  4. insurance funds
  5. Pension funds provided
  6. Fund venture capital firms

Important Conditions To Know Before Investing In IPO

1.Minimum SubscriptionFor any company to be listed in NSC and BSC, it is necessary to have at least 90% IPO applied. When a company brings shares of 10 crores, then it is necessary to invest at least 9 crores of this company by the IPO investor, otherwise that IPO gets infected and investors have to return the money. Due to which that company is not able to get listed in NSC and BSC.

2.Minimum ApplicationIt is not that you can buy 1 or 2 shares in the IPO of a company, the company says that we want a minimum amount, whichever investor should invest in our company, that is, we will only give serious people a share in our IPO company. . Out of which there are also some guidelines of SEBI.

  • ValueAccording to the guideline, you can invest at least 10 to 15000 in IPO. For example, if a company has IPO price of ₹ 250 and 1 lot size is 50 shares, then you have to buy at least 50 shares of the company for Rs 250. If you want to invest in our IPO.

3.Bid Amount-As we have already talked about the minimum bid amount any retail investor can invest maximum of 200000 and if invest more than two lakh then it comes in the form of NII or else comes in the category of your QIB. go.

Apart from this, any employee of the company can buy maximum shares of 500000 and not more than that.

4.Bidding at Cap (Cut off) PriceCapprice is the maximum price of an IPO. In which you can invest but only retail investors can invest in it, QIB and NII investors cannot invest in it.

5.Revise Bids Before Closing Date– If we talk about Revive Beads, then retail investor can revise their bead in this. He can also cancel or close his investment, but this option is not available with QIB and NII.

6.Promoter ContributionPromoter contribution also has some rule requirements. In this, at least 20% of the promoter issue capital should be with the promoter. Example: ABC is an IPO. Whose price total value is 1 crore, after issue of shares, then those who are promoters, their share should be valued at two crores. And they have to maintain at least 20% capital for 3 years.

7.Oversubscribe– Oversubscribe means the number of shares the company is bringing. Beed subscribed more than that. If 1 lakh shares are reserved for retail investors in the IPO of a company and if two lakh bids i.e. 2 lakh IPO are applied for 1 lakh shares, then we will call it retail category doubly i.e. oversubscribed if those 500000 bits for 100000 shares, we will say retail category is oversubscribed 5 times. Because this company had launched only 1 crore IPO but it invested so many people that its 5 crore IPO was applied.

So when such a condition comes, the ITO booking of many people gets canceled. These few conditions have to be kept in mind. Before bringing any company IPO and investor also has to go.

The allotment process of shares takes place a few days after the bidding of shares in an IPO. Let us know how shares are allotted for retail investors.

You cannot buy 1 or 2 shares in an IPO. The company that brings the IPO decides an allot size and you have to buy the shares of that company in the allotment. Example Suppose ABC is a company which is bringing its IPO in the stock market ABC has kept the price of one of its shares at ₹ 1000. And if the lot size is 14 shares, then the price of one lot will be ₹ 14000.

To invest in an IPO, you need to book at least one allot bid. If you bid from 18 lots of ABC then you will be called as retail investor and you have to apply from retail category. Because your investment of eighteen lots will be less than 200000 and if you bid more than 18 lots then you will be called as high network investors and you have to apply from HNI category. Because when you bid more than 18 lots then your investment will go more than 2 lakhs.

Must know before applying for IPO

  • When investing in IPO there is no guarantee that we will get IPO allotment when the subscription is more then some people IPO allotment gets rejected. Because after oversubscription, not everyone is able to get share allotted.
  • Apart from this, before applying investment bid in IPO, you have to see the price of that IPO. What is its price? Not that you can only share one or two. Here you have a minimum allotment.
  • When there is oversubscription inside a company, then anyway the shares of all the people are not available, then there is a lucky draw.
  • Apart from this, we have to keep in mind the date and time of applying IPO bid that till which date we can allot the IPO.

Apply IPO from Zerodha

If you are trading through Zerodha Kite then you can return the IPO in a very easy way.

  • So first of all we have to open the vigorous item if you are using laptop a computer then you have to login in jodha kite.
  • After login to Zerodha Kite, you have to go to the Account section. As you can see in the image, in the account section, you get the option of IPO, click on it.
  • As soon as you click on the IPO it will open in your browser. As you can see in the image below. You get the IPO option in the Zerodha Console IPO section. In which the list of all IPOs will be found.
  • Whatever IPO is open, you can see it in the IPO list, the option of apply will also be visible, if you want to buy IPO then click on apply.

After clicking on apply, you get the complete details of the IPO in front of you. Before investing in any IPO, it is very important for you to have complete information about it, so let’s know the details of IPO as shown in the image below.

  • Issue OpenThe date on which the IPO came on the stock exchange can be seen here.
  • Issue EndThe date on which the IPO will stop being plotted can be seen here.
  • Issue SizeThe number of IPOs the company has launched can be seen here.
  • Issue PriceWhat is the price of the company IPO, you can see the price here. When the company launches its IPO for the first time, it fixes a different price.
  • Minimum quantityThe minimum number of IPOs of the company can be bought. Can see his number here, can’t book less than this. When a company brings IPO, it decides that the minimum number of traders should buy its IPO because IPO cannot be bought in one or two numbers when it is listed in BSC and MSC then you have to buy it. You can buy as per your wish.

Above you have come to know about the company’s IPO. Now further we will know about applying for IPO i.e. to book and make payment.

  • PaymentThere is only one payment option interest for investing in IPO, in which you can pay for that IPO by entering your UPI ID.
  • Investor TypeIn Investor Type, you have to select Individual Investor.
  • QuantityNow you have to enter the quantity in which quantity you want to take the number of IPOs.

In the IPO details, you must have been told the minimum quantity as you can see in the image that the minimum number of this IPO is 3000, if you enter the quantity less than 3000, the IPO will be declared.

  • cut off price– On selecting on the cut off price, whatever cutoff will come for that IPO will be allotted to you at that price.
  • PriceIn the Price section, you can see how much that IP is being priced, in which the total IPO price will be shown.

You can do any IPO allotment in the same way as we saw above. Whenever an IPO comes in the coming days, months, years, you can allot it like you.

Increase chance of allotment

If we invest in IPO then how can we increase the chances of allotment.

  • If you want to invest a little more. So if you want to take more than one allot, then you apply from multiple accounts, if someone in your relative or family has a demat account, then you can also apply allot from their account, which increases the chances of getting your allot booked. Because these allotments are based on PAN, IPOs are allotted according to the PAN number you have.
  • Now we have to keep in mind what kind of IPO we want to invest in. As we have to select on cut off price or whatever final price decide we should apply.

So in today’s information you have got to know the complete information about investing. If you want to invest in a company’s IPO, you can see it in your trading application. First collect all the information about that company and only then apply in it. And if you have any query regarding trading, if you have any question related to this information, then you can tell us by commenting or email us.

Know all about investing. If you want to invest in a company’s IPO, you can see it in your trading application. First collect all the information about that company and only then apply in it. And if you have any query regarding trading, if you have any question related to this information, then you can tell us by commenting or email us.

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