What is an IPO?
An Initial Public Offering (IPO) is while a private business enterprise offers its stocks to the general public for the first time. This lets in investors to buy organisation stocks and come to be part of its boom journey. IPOs are an top notch possibility for investors to buy shares at an early level, often at a lower rate than put up-listing values.
Why Do Companies Launch an IPO?
✅ Raising Capital – Companies use IPO funds for expansion, debt repayment, and new projects.
✅ Increase Brand Value – A public listing boosts credibility and attracts global investors.
✅ Liquidity for Early Investors – Founders, employees, and early investors can sell their shares.
✅ Market Visibility – Listed companies gain higher public trust and recognition.
Types of IPOs
1. Fixed Price IPO
- The company sets a fixed price per share before the issue.
- Investors pay the full amount upfront.
2. Book Building IPO
- A price range (e.g., ₹100-120 per share) is set.
- Investors bid within this range, and the final price is decided based on demand.
How to Apply for an IPO Using a Demat Account?
A Demat Account is essential for investing in an IPO. It acts as a digital wallet to hold shares.
Step-by-Step Process to Apply for an IPO
1. Open a Demat Account
- Choose a SEBI-registered broker like Zerodha, Groww, Upstox, Angel One, or ICICI Direct.
- Complete online KYC by submitting Aadhaar, PAN, and bank details.
2. Check the IPO Details
- Visit the NSE or BSE website to see the latest IPOs.
- Analyze company financials, IPO price band, and lot size.
3. Apply for the IPO via a Trading App
- Go to the IPO section in your trading app.
- Select the number of lots you want to bid for.
- Use UPI or net banking to block funds.
4. Wait for IPO Allotment
- The company allots shares based on demand & availability.
- If you don’t get shares, your blocked amount is refunded.
5. Listing & Selling Shares
- If you get IPO shares, they are credited to your Demat Account.
- You can sell or hold shares when the stock gets listed on the exchange.
Best Demat Account Providers in India (2024)
| Broker | Best For | Annual Charges | Key Features |
| Zerodha | Discount Trading | ₹300 | Low brokerage, advanced charts |
| Groww | Beginners | ₹0 | Simple UI, easy mutual fund investing |
| Upstox | High-Speed Trading | ₹0 | AI-based stock recommendations |
| Angel One | Full-Service Brokerage | ₹0 | Free research & advisory |
| 5Paisa | Budget Traders | ₹0 | Low-cost brokerage, Robo-advisory |
Benefits of Investing in an IPO
✅ Chance to Invest Early – Buy shares before they are available to the public.
✅ Potential for High Returns – Many IPOs deliver strong post-listing gains.
✅ Portfolio Diversification – Investing in IPOs adds new stocks to your portfolio.
✅ Easy Online Application – Invest through trading apps in minutes.
Conclusion
IPO investments provide a notable possibility for wealth creation, however it is important to analyze the corporation earlier than investing. A Demat Account is mandatory for IPO buying and selling, and choosing the proper dealer can beautify your revel in.
