A Complete Guide on How to Apply for IPO in Zerodha

Introduction

Investing in IPOs (Initial Public Offering) is a great way to earn potential returns on a company’s growth. Investors who are new to the market often don’t know how to apply for IPOs but Zerodha, India’s leading brokerage firm, makes it quite easy.

In this article, we will give you all the steps you’ll need to apply for an IPO in Zerodha. This guide is easy to understand and will make you understand the process in no time!

First, let’s briefly look at what you’ll need to apply for an IPO in Zerodha!

Requirements to apply for an IPO in Zerodha

1. An active demat and trading account on Zerodha.
2. A UPI ID for making the monetary transfer. You can view all the UPIs available to apply for an IPO here
3. Or a bank account to transfer funds to the Zerodha account.

The benefits of applying thorough Zerodha

• Zerodha’s online platform allows you to apply for IPOs from the comfort of your home.
• The platform provides clear information about each IPO, including the issue price, lot size, and minimum investment amount.
• The application process is streamlined and user-friendly, making it easy for beginners to participate in IPOs.

Steps to apply for an IPO in Zerodha

Once you have the prerequisites in place, you can quickly apply for the IPO in Zerodha via two methods: using UPI or the Application Supported by Blocked Amount (ASBA) method.

Application using UPI Method

1. Log in to Zerodha Console

• Go to the Zerodha Console.
• Log in using your Zerodha username and password.

2. Find the IPO Section

• Once you’re logged in, click on the “Portfolio” tab.
• From the dropdown menu, select “IPO.” This will take you to the IPO application page.

3. Pick Your IPO

• Check the list of active IPOs.
• Select the one you’re interested in to start the application process.

4. Enter Your Details

• Specify how many shares you want to buy.
• Choose your bid price. You can either select the “cut-off price” to simplify things or enter a price within the company’s given range.

5. Add Your UPI ID

• Input your UPI ID and confirm it.
• Make sure the UPI ID you provide is linked to your bank account.

6. Approve the Payment Request

• Check your UPI app (like Google Pay, PhonePe, or BHIM) for a payment request.
• Approve the request to block the funds needed for your application.

7. Confirm Your Application

• Once you’ve approved the payment, your IPO application is submitted. Zerodha will send you a confirmation via email and SMS.

Application using ASBA method

With ASBA, you apply for an IPO without transferring funds upfront. The bank temporarily blocks the required amount in your account. If you get the shares, the blocked amount is debited. If you don’t, the block is removed, and you can use the funds as usual.

Online application:

• Log in to your bank’s Internet banking portal.
• Navigate to the IPO section and fill out the required details, including:
• Demat ID: A 16-digit unique number that identifies your Demat account. Find it by visiting console.zerodha.com/account/demat.
• Depository: CDSL.
• DP Name: Zerodha.
• Complete the application by submitting it through your bank.

Offline application:

• Download the blank ASBA form from NSE or BSE websites.
• Print the form and fill in details such as:

1. Personal information.
2. Demat account details.
3. Bid quantity and price.

• Submit the completed form to your bank. Ensure your bank is listed as a Self-Certified Syndicate Bank (SCSB).

Key points to remember

1. If an IPO is oversubscribed, shares are allocated through a lottery system.
2. If you don’t get an allotment, the money that was blocked in your account will be released automatically.
3. Minor account holders can also participate in the IPO bidding.
4. Applications will be rejected if submitted for the same IPO using multiple demat accounts linked to the same PAN.
5. While Zerodha doesn’t allow modifying the IPO price, some IPOs may have a cut-off price. In such cases, ensure your bid price is at or above the cut-off price to increase your chances of allotment.
6. IPOs involve inherent risks, and the share price may not always rise after listing. Always conduct thorough research on the company before applying for an IPO and invest only what you can afford to lose.

Zerodha is the most convenient and hassle-free way to apply for an IPO. Applying for an IPO through Zerodha will save you a lot of time and give you a user-friendly experience. By following the steps outlined above and keeping the additional points in mind, you can ensure a smooth IPO application process and make informed investment decisions. Remember, IPOs are subject to market risks, so conduct proper research and invest cautiously.

Frequently Asked Questions (FAQs)