How many lots should you apply for in an IPO?
For most retail applicants the answer is one lot, and the reason is how oversubscribed IPOs are allotted.
Oversubscribed: lots do not help
If the retail portion is subscribed more than 1 time, shares go to applicants by a draw, and a winner generally receives one lot whatever number of lots they applied for. Applying for ten lots gives you the same one-lot allotment and ties up ten times the money until the refund date.
Undersubscribed: you get what you bid for
If the retail portion is subscribed less than 1 time, valid applications can be allotted in full, so more lots mean more shares. This is the only case where bidding for more lots clearly pays off. It is also the case where demand for the IPO is weak.
Working out the cost
One lot costs the lot size multiplied by the upper end of the price band. Retail bids are capped at ₹2 lakh in total, so the maximum number of lots is ₹2 lakh divided by the cost of one lot, rounded down. IPO Khata shows the minimum investment, the retail maximum and where HNI starts on every open IPO's page.
Family members
If you want more chances rather than more shares, the effective way is a separate application from each adult family member with their own PAN, demat and bank account, rather than more lots on one application.
Related guides
- How to improve your chances of an IPO allotment
- IPO lot size, price band and cut-off price explained
- How IPO allotment works
More on applying for an ipo
- How to apply for an IPO in India
- Can family members apply for the same IPO separately?
- The IPO UPI mandate, explained
- What the cut-off price means in an IPO
- How to modify or cancel an IPO bid
- Applying for an IPO through net banking (ASBA)
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Information, not investment advice. GMP is an unofficial grey-market indicator; figures come from public sources (InvestorGain) and may be late or wrong. Not registered with or affiliated to SEBI, the exchanges, the registrars or InvestorGain.