How to increase the chances of allotment in an IPO?

Everyone wants to get a piece of IPO allotment but only lucky ones get it, and most of us are left heartbroken about it and wonder ‘Why didn’t I get the allotment? I was applying constantly but still didn’t get it. There’s no use in applying for an IPO because I never get any allotments.’ If you are among us, there are several steps that can be taken to increase your chances of applying for an IPO. 

Here are some steps to follow to increase your chances of getting an allotment.

• Avoid big applications: 

Try avoiding big applications from a single account. Let’s say you have the money to buy 10 lots, so instead of putting all the money in just one IPO, try utilizing it for other IPOs as well. This means instead of putting all the money into one IPO, invest a minimum bid, so that the idle amount or the leftover can be invested in other IPOs. In the case of oversubscribed IPOs, one should go for minimum bids from multiple accounts if possible. 

• Apply from more than one demat account:

Instead of applying for all the lots from a single demat account, try using multiple accounts, especially in case of oversubscribed IPOs. Applying from multiple accounts increases the chances of getting an allotment.

• Always apply for IPO at the cut-off price:

In an IPO, the company usually has a price band (let’s say ₹90 – ₹95), so instead of buying at ₹90 or somewhere in between in the hope of paying less, go for the cut-off price, which in this case is ₹95. Bidding at cut-off price means one is paying the highest price when applying for the IPO. In case, the price is set lower than ₹95, the excess amount will get refunded. 

• Avoid applying for the IPO at the last moment:

Many a time, due to technical issues, one fails to apply for the IPO at the correct time. So, instead of waiting for the last minute to apply for the IPO, it is better to apply a little early. If you are sure that you want to apply for one specific IPO, then try applying for it on the second day. In case there are any technical issues on that particular day, you have one more spare day to invest. 

• Approve the mandate request:

If you’re a new investor or an existing investor, sometimes investors fail to approve the mandate request which completes the IPO application process. It is wise to see carefully if you have approved the mandate or not. 

• Purchase the shares of the parent company:

Adding at least one share of the parent or holding company to your demat account is a smart approach to boost the value of your IPO. Your eligibility to apply in the shareholder category can be ensured by doing this.

Conclusion: Make sure that all the details are filled in properly, including your UPI ID and make sure you do your research before applying for the IPO. There is no guarantee about how the allotment process is done. But following the above steps can increase your chances of allotment. Do write to us if the above steps helped you in getting an allotment.