IPO Allotment Tricks: Friends, recently you must be getting to see that many IPOs keep coming out and some IPOs have also given very good listing gains. Many of you must have applied for an IPO but very few people get an allotment in it. What happens more often than not, the companies that come out with the IPO become oversubscribed. For example, if the company has issued 1 lakh shares but the application has come for 3 lakh shares, then it is called an oversubscription. So in that case these IPO allotment tricks will help you to get a confirmed IPO allotment.
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Now the company has to give only 1 lakh shares, so in this case, the chances of getting allotment in IPO are reduced. On the other hand, in the case of under-subscription, the chances of getting an IPO are high. Because under subscription means that applications come for less than the issued share. For example, if the company has issued 1 lakh shares but the application has come for only 50000 shares, then whoever applied for the IPO of this company would definitely get the shares.
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IPO Allotment Tricks To Get Confirm Allotment
In case of oversubscription, you will get the IPO, there is no sure method, using some IPO allotment tricks you can increase the chances of IPO allotment.
Always apply at the cut-off price
When IPO is oversubscribed then we should always apply at the above closing price. For example, the closing price of an IPO was 400 to 405 per share, this IPO was oversubscribed and an investor who applied for 400 or 402 shares would not be allotted and the investor who applied for 405 would get an allotment. The chances will be higher.
Apply for a single lot
In case of oversubscription of IPO, you can get a single lot irrespective of the number of shares you have applied for. Which is taken out through the lottery system. If the size of the IPO is small, then the chances of subscription are high, in this case, you should apply for a single lot only, it increases the chances of allotment. However, if the IPO is undersubscribed or the size of the IPO is large, then you can apply for multiple lots. But applying for generally 1 lot increases your chances of allotment.
Apply With Multiple Demat Accounts
As you know, to apply for an IPO, you need a Demat account, then you can apply with multiple Demat accounts to increase the chances of your IPO. But that account should not belong to the same person. That is, a separate PAN should be registered in the account from which you are applying, that is, you can also apply from the Demat account of your friend and relative. If they do not have a Demat account, then get their Demat account opened too. Applying for an IPO with such multiple accounts increases your chances of getting the allotment.
Note:- Keep in mind one thing if you apply from two accounts in which you have the same PAN card, then your application will be rejected.
Avoid Technical Rejections
IPO applications can also get rejected due to technical errors. While applying for the IPO, all the details should be filled in very carefully, if there is even a slight mistake like your name, or PAN card details are different in the bank account, then your application may be rejected. To Avoid Technical Level Pay Rejection, Apply Through ASBA ASBA Means Application Supported By Blocked Amount This is a process which is developed by the Indian Stock Market Regulator SEBI to apply an IPO In this IPO Applicant’s Bank Unless there is a debit till the shares are allotted to them. So for smooth processing, you should use ASBA.
Avoid Last Movement To Apply
What many people do is after seeing other people, they ask many people and then enter the last movement, but on the last movement, anything can happen like there can be an internet issue, can be an issue related to the bank’s server. Due to this your IPO application process may not be completed on time. Therefore, do not apply on the last day and apply till the second day of the issue.
Buy parent company shares
Before discussing these points, let us understand what is a parent company and a subsidiary company. Like people buy shares of the company, in the same way, a big company can buy major shares of a small company, major shares mean more than and equal to 51% of the shares, due to which the control of the small company also comes to the big company.
The company is called and this smaller company is called a subsidiary company. So whenever the subsidiary company will take out the IPO and you want to invest in it, then you first buy the shares of the parent company, even if you take only 1 share, after that you can apply in the IPO of the subsidiary company in the category of shareholders, this will give you allotment in the IPO. Chances of meeting increase.
So I hope this article “IPO allotment tricks” is helpful for you. By using these tricks you can increase your chances of getting an allotment in your IPO.