How To Invest In IPO

IPO has become the buzzword for today's generation! Even the youth are involved in the stock market, and IPOs have become a trend nowadays.

What is an IPO?

Initial Public Offering (IPO) is when a private limited company goes public by issuing shares to the general public. The issuer is the company offering its shares to the public; however, it is done with the guidance of several investment banks. Companies go for IPOs to raise money for any number of reasons.

How To Invest In IPO Online

Investing in an IPO can be simple if you follow these steps using UPI (Unified Payments Interface):

Download a UPI App

• Go to the Playstore (for Android) or the Appstore (for iPhone).
• Download any UPI app, such as Google Pay, PhonePe, or Paytm.

Create a UPI ID

• Open the UPI app.
• Follow the instructions to create a valid UPI ID and set a password.

Log in to Your Trading Platform

• Use your trading app or website.
• Log in with your account details.

Apply for the IPO

• Go to the IPO application section on your trading platform.
• Fill in the required fields.

Enter Your UPI ID

• You will see an option to enter your UPI ID during the application process.
• Enter the UPI ID you created.

Approve the Payment Request

• After entering your UPI ID, you'll get a payment request on your UPI app to block the required amount for the IPO.
• Open your UPI app and approve the request.

Complete the Application

• Once you approve the payment request, your IPO application will be successfully submitted.

By following these steps, you can easily invest in an IPO using your UPI ID.

You Can Apply For An IPO Offline Through The Following Process:

1. Register as a new user on the NSE website
2. Enter required details such as basic details (name and address) and PAN card number to get your User ID and Password.
3. Download the ASBA form, fill in all the details required, and submit it to the nearest self-certified syndicate branch or your stockbroker.
4. Submit the required identity proofs along with the cheque for the desired amount.

After verification, ASBA will block the desired amount from your account, and your application process will be complete.

What are the benefits of investing in an IPO?

1. Get in on the action while the pitch is being prepared:
   When you invest in an IPO, you are entering the company's ground floor. Also, the IPO may prove to be your window to rapid profit in a short duration, or it can also help you grow your wealth in the long run.
   
2. Meet long-term goals:
   IPO investments have growth potential in the long run. The amount earned can help the investors meet their long-term financial goals.
   
3. Price transparency:
   The price per share is mentioned in the IPO order document, so the retail investors have the same information as the big sharks. The price change only happens post IPO and would depend on the changing market rates. So, applying for an IPO is far better than buying regular equity stock.
   
4. Buy for less and make it big:
   Often, the IPO price is the lowest if you invest in a small company with a high potential to grow.

Is IPO safe or not?

Every retail investor or anyone investing for the first time is bothered with the question, 'is IPO safe'?

Requirements To Invest In An IPO

The requirements to invest in an IPO are quite low and simple. What you need to have are trading and Demat accounts.

Any investor willing to apply for an IPO needs to have a Demat account as a Demat account lets the investor buy and sell shares online.

However, if you don't have a Demat account, you need to open a Demat account. You will need a few documents like:

1. Aadhar Card
2. PAN card
3. Address
4. Identity proofs.

Can I Apply for an IPO Without a Demat Account?

Recently the stock market has taken a huge shift seeing many new and young investors. As a new investor, you may have this question on your mind can I apply for an IPO without a Demat account?

Yes, you can apply however, it is recommended to open a Demat account first as without demat you can't store the IPO as it is allowed.

Is ASBA Mandatory for IPO?

If the shares are allotted to the investor, the amount is debited from the account. If the shares are not allotted to the investor, the amount is credited to the bank account. Therefore there is no loss in applying for an IPO through ASBA.

Moreover, on January 1, SEBI made it compulsory for all investors to apply through the ASBA. Since this, all IPOs have applied through the ASBA process.

How To Check IPO Allotment Status?

Like applying for an IPO, checking your allotment status is also quite easy. Let's see how to check IPO allotment status:

To check the allotment status of an IPO, you must check on the official website of the registrar of that particular company. You will have to check the IPO allotment section available on the website.