Posted on 15th Dec 2016
by TopShareBrokers Team
In this article, we will be discussing how to invest in IPOs online, which institutions support IPO investment, other ways than online to apply for IPOs, charges to apply in IPOs, checking allotment status online etc.
To invest in IPOs, you need a bank account and a demat account. To sell the stocks in your holdings post IPO allotment process, you need a trading account.
You can invest in IPO via Online or Offline mode (physical form).
Full form of ASBA is “Application Supported by Blocked Amount” Procedure. ASBA provides an alternative mode of payment in issues whereby the application money remains in the investor's account till finalization of basis of allotment in the issue.
Process flow to show how ASBA works:
Most of the national banks in India provide forms to apply in IPOs. Under ASBA (Application supported Block Amount) facility for applying IPOs, investors can apply in any public/rights issues by using his online bank account. The list of ASBA participating bank are provided in below section.
Lets see example how to apply IPO’s using ICICI online banking:
On this page you can see all open IPOs, select the IPO which you want to Invest.
Similar process is available under investment option in online banking site of all major banks like SBI Online, HDFC Bank, AXIS bank - .
Step by step guide to apply in IPO using online Bank account: >> Guide
Applying in IPOs basically doesn’t need a broker. You just need a demat account with any broker. Under ASBA (Application supported Block Amount) facility for applying IPOs, investors can apply in any public/rights issues by using their bank account.
The steps to apply in IPOs using your bank account is as follows:
Step by Step guide to invest in IPO by submitting physical application form: >> Guide
List of Self Certified Syndicate Banks (SCSBs) for Syndicate ASBA.
|Seq #||Bank Name||Branch Detail|
|4||Bank of Baroda||Branches|
|5||Bank of India||Branches|
|6||Bank of Maharashtra||Branches|
|10||Central Bank of India||Branches|
|12||City Union Bank||Branches|
|22||Indian Overseas Bank||Branches|
|24||ING Vysya Bank||Branches|
|25||J P Morgan Chase Bank, N.A.||Branches|
|26||Janata Sahakari Bank||Branches|
|28||Karur Vysya Bank||Branches|
|29||Kotak Mahindra Bank||Branches|
|30||Nutan Nagrik Sahakari Bank||Branches|
|31||Oriental Bank of Commerce||Branches|
|33||Punjab National Bank||Branches|
|34||Rajkot Nagarik Sahakari Bank Ltdx||Branches|
|35||South Indian Bank||Branches|
|36||Standard Chartered Bank||Branches|
|37||State Bank of Bikaner and Jaipur||Branches|
|38||State Bank of Hyderabad||Branches|
|39||State Bank of India||Branches|
|40||State Bank of Mysore||Branches|
|41||State Bank of Patiala||Branches|
|42||State Bank of Travancore||Branches|
|44||Tamilnad Mercantile Bank||Branches|
|45||The Ahmedabad Mercantile Co-Op. Bank||Branches|
|46||The Federal Bank||Branches|
|47||The Kalupur Commercial Co-Operative Bank||Branches|
|48||The Lakshmi Vilas Bank||Branches|
|49||The Saraswat Co-operative Bank||Branches|
|50||The Surat Peoples Co-op Bank||Branches|
|52||Union Bank of India||Branches|
|53||United Bank of India||Branches|
To get the branch details in your city, please refer NSE Link or BSE Link.
Note: This process is only valid with 3 in 1 account with broker or the bank-based stock broker, not valid with any other full service brokers who provide 2 in 1 service.
Most of the full service brokers in India offer IPO Investment facility online. The process to apply in IPOs online is extremely simple and fast. All you need is to have a trading account with full service brokers who provide online IPO Investment facility. If the broker is bank-based i.e. 3-in-1 service provider ( bank +demat+ trading account) then it will be even better because the transaction between the bank account and your online IPO account will be seamless.
Generally these are the basic steps you have to follow to apply for IPOs online:
Discount Brokers run on low margin business. They try to cut down their operational cost as much as possible and transfer the benefit to their customers by charging very low brokerage in the form of flat fee irrespective of the size and volume of trade.
IPO investment facility needs a broker to be registered as a distributor of IPOs. They have to get license to be authorized distributor of IPO. The commission they get on each application submitted through them is so low that brokers won’t find it much interesting in terms of financial benefits to be a distributor of IPOs.
Discount Brokers like Zerodha, ProStocks, RKSV, SAS Online, TradeSmartOnline are among a few who do not offer IPO investment facility.
As you have trading and demat account with Discount Brokers like Zerodha, RKSV, Upstox, ProStocks, SAS Online, Trade Smart Online, SAMCO and so on, you will not get online IPO Investment feature with your broker portal. In such case, you can use your online banking to invest in IPO. Go to your bank online banking site, under investment option, invest in IPO with your discount broker demat account. After allotment, your shares are going to deposit in your given demat account and you can sell them from your discount broker trading account.
Applying in IPOs through broker’s online platform is completely FREE. You do not pay any fee, charges or taxes to apply for IPO shares.
However you have to pay brokerage and taxes when you sell the shares allocated to you through IPO. The charges are same as you sell any shares bought directly from the stock market.
The IPO allotment status on broker’s website is updated only after the shares are transferred to your demat account (usually a day before IPO shares listing). The shares in your demat account will then be available to you to sell them on date of listing at the respective exchanges.
You can check the IPO Allotment Status directly on the broker’s website. Usually, the steps are as follows:
Mostly but not all the brokers provide call and trade facility to apply for IPOs.
It is better to check with your broker specifically on this without making any assumptions.
Stock Exchanges of India NSE And BSE provide separate platform for small and medium enterprises (SMEs) to go public by issuing IPOs to raise equity capital for their growth and expansion. These IPOs by SMEs are called SME IPOs.
Bombay Stock Exchange’s platform for SME IPO is called BSE SME Platform.
National Stock Exchange’s platform for SME IPO is called NSE EMERGE platform .
SME IPOs are not available online. You have to fill and sign the forms to apply in SME IPOs.
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