Initial Public Offerings (IPOs) are an ideal investment option for capital appreciation. IPOs can potentially earn big returns as they are equity-based securities, initially offered at discounted rates.

 

In the last few years, the success stories of IPOs greatly outnumber their failures. This is one of the biggest reasons for the popularity of IPOs in the market. However, you must know how to apply for an IPO to earn from this investment.  


Read on to learn how to apply for an IPO online and offline.

How to Apply for an IPO Online

There are two ways in which you can apply for an IPO online, and these include:

1. Through Internet Banking 

Here is how to apply for an IPO online if you have an active internet banking account:

  • Step 1: Visit your bank’s official website and log into your account 

  • Step 2: Click on the ‘Application Supported by Blocked Amounts (ASBA)’ tab 

  • Step 3: Choose the ‘Apply IPO’ option once you get redirected to a new page

  • Step 4: Fill out the required information, like PAN details and your name 

  • Step 5: Enter the lot size you wish to bid as well as the price 

  • Step 6: Submit your application
     

If you submit your application before 2 PM on a trading day, your application will be accepted the same day. Otherwise, you will have to wait until the next trading day to get your application accepted.

2. Through a Broker

Here is how to apply for IPOs through a SEBI-authorised broker: 

  • Step 1: Visit the broker’s official website and log in to your account (you will have to register yourself if you do not have an account)

  • Step 2: Search for the ‘IPO’ tab on the dashboard and click on it

  • Step 3: Choose the IPO in which you wish to invest from the list of available IPOs

  • Step 4: Enter the bid quantity and the price for each security and submit

  • Step 5: Enter your UPI ID and open the UPI third-party application to approve the payment request
     

Remember, once you apply for an IPO, the bank will block the amount for the lot size you bid. If you get the shares, the same will be deducted from your account. If not, the amount will be unblocked/refunded. You will receive communication for the same.

How to Apply for IPOs Offline

If you do not wish to apply for an IPO online, you can also purchase it offline. Here is how to apply for IPOs offline: 

  • Step 1: Visit your nearest bank branch or an office of a brokerage firm

  • Step 2: Fill out the ASBA application form

  • Step 3: Provide your KYC details and other requested details 

  • Step 4: Submit the application
     

Just like online, in the offline application, the amount gets blocked and will get deducted if the shares are allotted to you.

Eligibility Requirements for an IPO Application

To purchase an initial public offering, you need to fulfil the following eligibility requirements:

  • You must be an approved investor under the SEBI guidelines, i.e., employee, non-institutional buyer, retail individual investor, or qualified institutional buyer

  • You must have a PAN card

  • You must have a Demat and trading account with a SEBI-recognised Depository Participant (DP)

  • Your Demat account must be linked with your bank account with the minimum balance to purchase IPO units

What are the Benefits of Online IPO Application?

By opting for the online IPO application process, you can enjoy the following benefits: 

  • Save time by avoiding physical visits to the bank or the broker’s office 

  • Experience a convenient, seamless, and transparent application process 

 

  • Earn interest on the application amount which remains in your savings account until the date of allotment 
     

 

In conclusion, while you can use either the online or offline IPO application process, the former saves you time and effort. To start your IPO application process, you need to choose a SEBI-authorised broker and choose an upcoming IPO.


However, if you haven’t opened a Demat account yet, you can do so on Bajaj Markets. In addition, on the platform, you can browse a variety of market-related investment tools to further diversify your portfolio.

FAQs on How to Apply for an IPO

If you are wondering how to apply for an IPO through a Demat account, you can easily do so by visiting a SEBI-regularised broker’s app or website. All you have to do is log in to your account, click on the ‘IPO’ section, and choose the IPO in which you wish to invest.

 

Now, enter the relevant details, like your PAN, full name, the bid quantity, and price to proceed. To complete your application, make a payment by adding your UPI ID and approving the request from the UPI app.

As per the SEBI mandate, a retail investor can invest up to ₹2 Lakhs in an IPO.

Yes, IPOs do carry the risk of investment loss. This is because they are equity-based securities, and their performance depends on the market conditions. However, they also have the potential to earn high returns.

If you are wondering how to apply for an IPO refund, you must know that you do not need to follow any such process. This is because when you apply for an IPO, the amount does not get deducted from your bank account. 

 

Instead, the amount required to purchase the IPO gets blocked till the time of allotment. If you do not receive a stock allotment, this amount gets unblocked automatically.

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