Initial Public Offerings (IPOs) have always been a hot topic among investors in India. The excitement, the potential for listing gains, and the opportunity to be part of a growing company’s journey attract millions of retail and institutional investors alike. However, one of the most anticipated aspects post-application is the IPO allotment status — the moment of truth where applicants find out whether they have received any shares or not.
This blog will guide you through the entire process of IPO allotment, how to check your allotment status, reasons for non-allotment, and what to do after you receive or don’t receive the shares.
What is Allotment?
IPO allotment is the process by which a company distributes its shares to investors who have applied for them. When the number of applications exceeds the number of available shares (which often happens in popular IPOs), the shares are allocated based on a defined set of rules by the registrar in consultation with the stock exchanges.
The Securities and Exchange Board of India (SEBI) has laid out transparent and fair practices to ensure equal treatment for retail investors. Shares are generally allotted through a lottery system in case of oversubscription, especially in the retail category.
Key Stakeholders in IPO Allotment
Understanding the parties involved can help investors navigate the allotment process more confidently:
- Issuer Company: The company offering its shares to the public.
- Lead Managers/Book Running Lead Managers (BRLMs): Merchant banks managing the IPO.
- Registrar to the Issue: An independent institution responsible for processing applications and conducting the allotment process.
- Stock Exchanges (NSE/BSE): Platforms where IPO shares are eventually listed and traded.
IPO Allotment Process: Step-by-Step
Here’s a breakdown of how the IPO allotment works:
1. IPO Closes
After the IPO bidding window (typically 3 working days), the issue is closed for subscription. All applications are frozen for further processing.
2. Data Reconciliation
The registrar collects and reconciles all applications, filtering out invalid or duplicate entries. This ensures only eligible applications proceed.
3. Oversubscription Analysis
If the IPO is oversubscribed, allotment is done via a lottery system. In such cases, many applicants may not receive any shares.
4. Finalization of Basis of Allotment
The registrar prepares the “Basis of Allotment” (BOA), which includes details like how many applicants got shares and in what quantity. It is then approved by the stock exchange.
5. Credit of Shares
Shares are credited to successful applicants in their Demat account, typically 2 working days before the listing date.
6. Refund Initiated
Unsuccessful applicants receive refunds via UPI or linked bank accounts.
How to Check IPO Allotment Status?
Once the allotment is completed, you can check your IPO allotment status using the following methods:
1. Through Registrar’s Website
Most IPO allotments can be checked on the website of the registrar (e.g., Link Intime, KFintech). You’ll need:
- PAN number
- Application number
- DP/Client ID
2. Through Stock Exchanges
BSE and NSE also provide allotment status. You must provide:
- PAN
- Application number
- Issue name
3. Through Broker Platform
If you applied through platforms like Zerodha, Upstox, Groww, or ICICI Direct, you can also check the status directly within the app.
Reasons for Non-Allotment
It’s not uncommon for retail investors to get zero allotment, especially in high-demand IPOs. Here are some common reasons:
1. Oversubscription
The most common reason. When demand far exceeds supply, allotment becomes a matter of chance.
2. Invalid Application
Wrong PAN, incorrect lot size, or multiple applications from the same PAN can lead to rejections.
3. Insufficient Funds
If the UPI payment was not approved on time, the application could be rejected.
4. Technical Rejections
Mismatch in name between PAN and Demat account, or issues in bank mandates, can also cause rejections.
Types of Allotment Scenarios
1. Full Allotment
You applied for 1 lot and got it. This is more likely in under-subscribed or moderately subscribed IPOs.
2. Partial Allotment
In some categories (like QIBs or NIIs), you might get fewer shares than you applied for.
3. No Allotment
This is common in oversubscribed IPOs. In this case, your money is refunded.
What to Do After Allotment?
1. If Shares Are Allotted
- Wait for them to reflect in your Demat account (usually 2 days before listing).
- Decide if you want to sell on listing day (for quick profit) or hold (for long-term gains).
2. If Shares Are Not Allotted
- Your funds will be unblocked.
- You can reinvest in upcoming IPOs or other stocks.
IPO Allotment Tips for Better Chances
While allotment is never guaranteed, the following strategies may improve your odds:
1. Apply from Multiple PANs
If you have family members with separate PAN and Demat accounts, apply through them as well (1 lot each).
2. Avoid Multiple Applications from Same PAN
Always stick to one application per PAN. Multiple entries from one PAN can lead to rejection.
3. Use UPI Carefully
Ensure you approve the UPI mandate before the cut-off time to avoid application rejection.
4. Apply Early
Though timing doesn’t affect allotment directly, applying early ensures you don’t miss the mandate window.
Common Myths About IPO Allotment
Myth 1: Applying for a higher number of lots increases chances
Fact: In the retail category, every investor is treated equally in oversubscribed IPOs. Applying for 1 lot gives the same chance as applying for 10.
Myth 2: Demat account provider influences allotment
Fact: Allotment is random (via lottery), not based on broker or platform.
Myth 3: Applying on the last day reduces allotment chances
Fact: The day you apply doesn’t affect your chance of getting shares.
Final Thoughts
IPO allotment status is more than just a result — it’s an important milestone for retail investors. Whether you’re a beginner testing the waters or a seasoned trader aiming for listing gains, understanding how allotment works gives you clarity and helps set realistic expectations. While luck does play a role in oversubscribed issues, being diligent and informed can make your IPO journey smoother.
So the next time you apply for an IPO, keep this guide handy. Whether you’re cheering at a successful allotment or planning your next move after missing out, you’ll be better prepared to navigate the dynamic world of primary markets.
