All you need to know about IPO application process

IPOs have gained popularity over time, with more and more investors looking to invest in a company looking to go public. The main drive behind this is to make quick and considerable profits in the form of returns on such investments.

For those wondering what an IPO or initial public offering is, here is a quick overview. An IPO is a process by which a previously privately-owned company goes public. This starts with an initial public issue of shares of the company thrown open to the general public. After the IPO, the company joins the leagues of publicly traded entities and its shares get listed for trading on the exchanges. The ownership of the company thus changes from private to public.

If you wish to apply for an IPO, there are two ways to do so- online and offline.

Online IPO application process

At ICICIdirect, we help you in the online IPO application process using a unified payment interface (UPI). You can use this option to invest in an IPO online even if you do not have an ICICIdirect trading account.

Start with mobile number verification where you receive a one-time password (OTP) for the same. Next, select the IPO of your choice from the dropdown menu. Provide requested details (PAN, demat account number, UPI ID, bid details, etc.) to proceed with the IPO process. Once you have successfully placed your bid, you would receive a request a request from your bank to authenticate fund blocking. Only once the shares are allotted to you will the funds be deducted from your bank account and shares transferred to your demat account. Here, the fund blocking facility is called Application Supported by Blocked Amount (ASBA) facility.

The prerequisites for an IPO application online are a demat account to hold your shares and a UPI ID to clock funds in your bank account.

To open a demat account, you can reach out to any depository participant (DP), banks or brokers.

Offline IPO application process

The ASBA facility is available for online as well as offline IPO application. In the offline mode, all you need to get started with investing in an IPO is a demat account. You can get an IPO application form from your nearest bank or broker. Once you fill in the necessary details- name, PAN number, demat account number, bid details like price- the form can be submitted to the bank branch designated to act as the self-certified syndicate bank (SCSB). Using the ASBA facility, the funds in your bank account are blocked corresponding to the value of the shares. However, the amount is deducted if and when the shares you bid for have finally been allotted to you.

To check whether or not your bank is an ASBA participating banker to a given IPO, you can visit the BSE or the NSE website. A list of available ASBA participating banks branches are available to ensure ease of investing in or applying to an IPO.

How to Apply for An IPO: Online IPO Application Process at ICICI Direct

References:

https://www.sebi.gov.in/legal/circulars/mar-2021/streamlining-the-process-of-ipos-with-upi-in-asba-and-redressal-of-investors-grievances_49522.html

Disclaimer : ICICI Securities Ltd.( I-Sec). Registered office of I-Sec is at ICICI Securities Ltd. - ICICI Centre, H. T. Parekh Marg, Churchgate, Mumbai - 400020, India, Tel No : 022 - 2288 2460, 022 - 2288 2470. Please note, I-Sec is acting as a distributor to offer IPO distribution related services and distribution of IPOs are not Exchange traded products. All disputes with respect to the distribution activity, would not have access to Exchange investor redressal forum or Arbitration mechanism. The contents herein above shall not be considered as an invitation or persuasion to trade or invest. I-Sec and affiliates accept no liabilities for any loss or damage of any kind arising out of any actions taken in reliance thereon.