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In the stock market, every day new publicly traded companies are listed and unlisted from the stock exchange. Whenever people discuss trading, the hottest topics of discussion are upcoming IPOs (Initial Public Offerings) and right trading strategies. For investors looking to make a break into a new market or bet on a new listing, IPOs are a great place to invest.
However, understanding IPOs and deploying the perfect strategies for picking a company is a rather complex topic to discuss.
What is IPO allotment?
Contrary to the usual intraday trading, investing in an IPO is more than just putting an offer. As you are not only placing an offer to buy the stock, it is also a contributing factor to the book-building process. And this, in turn, affects to whom and how the IPO-listed equity distribution takes place. An IPO allotment is the distribution of shares introduced as part of the IPO amongst various interested investors. This allocation is at a price derived during the book-building, which may (or not) be the same as the offer.
Why is it important to you?
During an IPO, there are multiple stages for the actual buying process. While some of these are more for regulation like the IPO prospectus, Red Herring, others are useful for the investors. As an IPO investor, you will place your offers/ bids for your interest to buy the equity. But this does not ensure your ownership or allotment of demat shares to you. Based on these bids, the involved investment banks and the exchange perform a pricing and book-building process. And only at the end of this process based on the number of subscribers and listing for the company, the shares are allotted to investors.
Therefore, this is important to you, to know how much equity was finally allocated to you and at what price. Based on this, you can make future financial decisions to hold, buy or sell the shares at the right time.
How to check IPO allotment status online?
After the IPO is officially closed, the exchange ( BSE, NSE, NSDL etc.) publishes the allotments and notifications to investors. This usually happens on the IPO listing date and allotment is completed by the IPO Registrar.
As an investor, you can do your IPO allotment status check online with some basic details. There are multiple official channels to do so and are pretty simple to access.
- Check with the IPO Registrar
Every IPO is listed with an official registrar that is responsible to keep track of the ownership and sale of equity between investors. For any IPO, you can find information of the registrar and you can visit their platforms to check your IPO allotment status. All you need is your details like PAN, demat account number and name of the company.
- Check your demat account
Once the IPO allotment is published, the registrar and the custodian work with your demat account broker ( like Angel One) and credit the allocated shares to your demat account. Depending on the processing overlay, you can check this information on the same day or the next.
As a disclaimer, you should be cautious in sharing your personal information on any platform. Only choose from reliable and registered sources to check your IPO allotments and you should not share any private information. Always look for signs of possible security threats and only use channels you trust.