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Find answers to common questions about IPOs, GMP, subscription, allotment, and using IPO Rise.
Grey Market Premium (GMP) is the premium per share that investors are willing to pay for an IPO application or shares before the official listing. It's an unofficial market indicator of expected listing price. GMP is calculated as: Expected Listing Price = Issue Price + GMP.
For example, if an IPO has an issue price of ₹100 and GMP is ₹20, the expected listing price would be ₹120. However, GMP is indicative and not guaranteed.
GMP is not officially calculated but determined by market sentiment in the grey market. It represents the premium investors are willing to pay over the issue price. GMP can fluctuate daily based on subscription trends, market conditions, and investor sentiment.
Kostak is the premium per application in the grey market. It's the amount paid to buy an IPO application form before allotment. If you sell your application at Kostak price, you get the premium regardless of whether you receive allotment or not.
Subject-to or Sub2 is the premium paid for an IPO application that is subject to allotment. You receive the premium only if you get shares allotted. If you don't get allotment, you don't receive the premium. Sub2 is typically higher than Kostak because it's riskier.
You can check IPO allotment status through:
The basis of allotment is usually announced 1-2 days after IPO closing. You'll also receive an email/SMS if you're allotted shares.
The minimum lot size varies for each IPO and is specified in the price band. For retail investors, you typically need to apply for at least 1 lot. Each lot contains a specific number of shares. For example, if lot size is 1000 shares and price band is ₹100-110, minimum investment would be ₹1,10,000 (1000 × ₹110).
Mainboard IPOs: Listed on NSE/BSE main exchanges with larger issue sizes (typically ₹100+ Cr). Lower lot sizes (usually 1000 shares), higher probability of allotment.
SME IPOs: Listed on NSE Emerge or BSE SME platforms with smaller issue sizes (typically ₹10-100 Cr). Higher lot sizes (usually 1200+ shares), lower probability of allotment due to smaller issue size.
You can apply for an IPO through:
You need a Demat account and trading account. The application can be made during the IPO subscription window (usually 3-5 days).
IPO subscription shows how many times the IPO is oversubscribed. It's calculated as: Total Applications Received / Total Shares Offered. For example, 10x subscription means applications for 10 times the shares offered.
Subscription is tracked separately for Retail, NII (Non-Institutional Investors), QIB (Qualified Institutional Buyers), and Anchor categories.
GMP is indicative and should not be the sole basis for investment decisions. It reflects market sentiment but is not guaranteed. The actual listing price may differ from GMP predictions.
Always consider:
Consult a SEBI-registered financial advisor before making investment decisions.
SME IPOs have lower allotment probability due to:
For example, a ₹20 Cr SME IPO with 1200 share lot size means only ~833 retail applications (1 lot each) can be selected. With 10x oversubscription, your probability is 1 in 10.
"Seller Only" in GMP means there are sellers but no buyers in the grey market. This is similar to a lower circuit in stock markets. It can indicate:
This situation may be temporary and can change before listing. Always check fundamentals before making decisions.
"Buyer Only" means there are only buyers and no sellers in the grey market. This is similar to an upper circuit. It indicates:
Still have questions? Feel free to contact us and we'll be happy to help.