ASBA
Application Supported by Blocked Amount. The mechanism by which your bid amount is blocked in your bank account (rather than debited) until allotment is finalized. Funds are released for non-allottees within 24-48 hours of allotment date.
Book Building
The price discovery process where the issuer publishes a price band and collects bids across that range. The final issue price is set based on actual demand within the band — usually at or very close to the upper band for hot issues.
Cut-off Price
The upper end of the price band. Retail investors can bid at cut-off to ensure their bid stays valid at any final price determined by book-building. Bidding at cut-off is the recommended default for retail.
DRHP
Draft Red Herring Prospectus. The first detailed offer document filed by the issuer with SEBI for review. Contains business description, financials, risk factors — but no price band or final dates yet.
RHP
Red Herring Prospectus. Updated version of DRHP, filed before the issue opens, with final issue size, price band, dates, and number of shares. The legally binding offer document.
Prospectus
Final prospectus filed after the issue closes, containing the final price and allotment details. Sent to all allottees as a record of their investment.
Lot Size
Minimum number of shares you must apply for in one application. For mainboard usually 15-100 shares per lot; for SME usually 1,000-1,500 shares per lot.
QIB
Qualified Institutional Buyer — mutual funds, FIIs, banks, insurance companies, pension funds. Typically reserved 50% of the issue (or up to 75% in some structures).
NII / HNI
Non-Institutional Investor (also called High Net-worth Individual) — anyone applying for bids ≥ ₹2 lakh. Subcategories: NII Small (₹2-10 lakh) and NII Big (>₹10 lakh).
Retail (RII)
Retail Individual Investor — anyone applying up to ₹2 lakh per IPO. Retail category is reserved 35% of most mainboard issues.
Anchor Investor
Institutional investors (mutual funds, FIIs) who commit to buying shares one day before the public issue opens, at the upper price band, with a 30-day to 180-day lock-in. Strong anchor list signals institutional confidence.
OFS
Offer for Sale — portion of the IPO where existing shareholders (promoters, early investors) sell their stake. No new capital is raised. Often called the "secondary" portion.
Fresh Issue
Portion of IPO where new shares are issued and the proceeds go to the company for capex, debt repayment, working capital, or general corporate purposes. Also called the "primary" portion.
GMP
Grey Market Premium — unofficial premium quoted in the grey market before listing. Indicates retail sentiment but is not a guaranteed return. See our detailed What is IPO GMP guide for more.
Allotment Ratio
Probability of getting allotted in oversubscribed IPOs. Computed as shares allotted to retail / total shares applied for in retail. On highly oversubscribed issues, can be 1 in 10 or worse.
Listing Gain
Percentage change between the issue price and the listing day's opening price (or closing price, depending on definition). Used to evaluate the immediate market reaction.
Lock-in
Period during which certain shareholders cannot sell their shares post-listing. Anchor investors typically have 30-180 day lock-in. Promoter lock-in is usually 18 months under SEBI rules.
UPI Mandate
The recurring authorization request sent to your UPI app to block the bid amount in your bank. You must approve it before the issue close to keep your bid valid.
Cut-off Time
5 PM on the issue close day — the last moment to approve your UPI mandate. Many bid rejections happen due to missed mandate approvals.
Basis of Allotment
The official process and date on which the registrar finalizes who gets allotted shares. Usually 3-5 working days after issue close. Allotment status is published on the registrar's website on this date.
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