A Detailed Guide to Application Steps for IPO Investment

Tuesday, Feb 6, 2024

Initial Public Offering opens an exciting opportunity to invest in a company while they are moving to public from private ownership. This enables any individual to become a permanent shareholder of that particular company. Investing in an IPO will fetch greater returns in a long time making it a useful option for investing.

In this article, we shall discuss the process related to IPO application. We will delve deep into the strategies so that everyone can take part in this process and gain economic liberation.

What is an IPO

Before digging deep into the steps of the application process, let us gather some basic knowledge about IPO. Through issuing an IPO, a private company opens its door for individuals like you to come and purchase their shares. After buying these shares, you can enjoy the status of a shareholder for a certain company. However, the main objective of an investor is to buy these shares at the time of the IPO and maximize your profit. Let us understand how the application process works.

IPO Assessment

Before buying the IPO, start by getting acquainted with the company. Delve deep into the financial condition, business structure and prospects of the company. Take good note of the information available in the prospectus. This prospectus is helpful before investment as it serves as a way to perceive the company's operations and potential threats.

Start your IPO journey with a brokerage account

You will need a brokerage account to take part in the IPO application process. Start looking for a trustworthy brokerage partner or platform that is also supportive towards IPO applications. There are many famous brokerage platforms available for newbies. They are not only helpful for guidance but also offer user-friendly interfaces creating an easy environment for investment. Let us look at some brokerage platforms and their websites so that you can easily navigate them.

Groww	https://groww.in/stocks/user/explore
Zerodha	https://zerodha.com/
Angel One	https://www.angelone.in/amp/sem/open-demat-account?gclsrc=aw.ds&&utm_source=google&utm_medium=cpc&utm_campaign=B2C_Search_Brand_Exact&network=g&keyword=angel%20one&matchtype=e&creative=536866727748&device=m&devicemodel=&gad_source=1&gclid=Cj0KCQiAkeSsBhDUARIsAK3tieeZiBj6yhRqK7NpMbE4Bm2e1o5DDtwliZYpiB3j8sX-s2EGXUoWG_IaAoaiEALw_wcB
Upstox	https://upstox.com/open-demat-account/?utm_source=google&utm_term=upstox&utm_creative=Responsive_Search_Ads&utm_campaign=ADS_Upstox_Brand_Exact_Oct23&utm_device=m&utm_content=search&utm_adgroup=Upstox&utm_placement=&utm_medium=cpc&gclid=Cj0KCQiAkeSsBhDUARIsAK3tiefEagJolb4cDlVABezeJ6Ykvufb7-JfPc1Ir8zFIJ2BfJ6sOxbzWHcaAqsOEALw_wcB
HDFC Securities	https://www.hdfcsec.com/

Maintain Sufficient Balance

You should always maintain sufficient funds in the account to make all investment-related transactions. However, this is not the same for every brokerage policy. In that case, always try to follow the instructions given by your brokerage partner to stay updated and work as per the guidelines drawn by them. This will help you to enjoy a risk-free investment.

Observe IPO Notifications

Investors should always monitor the IPO announcements. This will help them stay notified and plan accordingly. The brokerage partner must observe IPO announcements and inform you about the company and its profile. However, mark your calendar and prepare yourself for the IPO opening day investment.

Placing your first IPO purchase

At the start of the IPO auction, you start logging into your brokerage account and begin searching for the IPO section.

To purchase your first IPO, you need to abide by all the instructions given on that website.

Decide how many shares you want to buy and how much money you want to invest.

Be patient till the allocation

After placing an order for an IPO, there is not much you can do next. You have to wait patiently till the allocation is done by the company. Generally, IPO allocations are demand-driven. So, there might be a time when all the orders can not be fulfilled. Keep your hope intact as this is a common phenomenon in the world of IPO investment. You can check the status of the allotment from the official page of the IPO or the registrar’s webpage. However, you have to check the status by giving your PAN number and application number. Thus, you can get the information on the allotted shares and their quantity. Next, you have to keep track of the listing date so that you can monitor the stock exchange. Finally, take a thorough check on the performance of the stock after share listing.

You are good to go

You will get a confirmation if everything works well and you will become an official shareholder of the company. You can check shares-related data and other queries through the brokerage site.

Final Thought

In the end, it can be said that investing in an IPO looks a little complicated initially, but with proper strategy and guidance, one can easily be independent financially with it. These simple routes will help you to navigate the application process without putting in extra effort. Besides all these opportunities, IPO investment comes with risks. So, before going for investment, make a careful investigation to avoid any unnecessary outcomes. If possible, consult with skilled professionals for successful investment.

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