How an IPO share lists: the pre-open session
A new share does not simply open at the issue price. On listing day, its first price is found by a short auction before normal trading starts.
The pre-open session
In the morning of the listing day, the exchange runs a special pre-open session for the new share. Buyers and sellers place orders, which are collected and then matched in a call auction. The price at which the most shares can be traded becomes the opening, or listing, price.
Normal trading in the share starts at 10 AM. Orders that were not matched in the auction carry over into it.
Price limits
On the first day a new share has a price band, a percentage around the issue price, to stop wild swings. The percentage depends on the size of the issue (smaller issues generally get a narrower band, and SME shares have their own rules), and the exchange announces the limit for each IPO.
Between the allotment and the first trade
Allotment is finalised, refunds are released and the allotted shares are credited to your demat account, all before the listing day. Once trading starts they can be sold like any share.
Listing price and GMP
The listing price comes out of that auction, not from the grey market premium. The GMP is often close, but not always: see how accurate it has been on IPO Khata's GMP accuracy page.
Related guides
- What happens on IPO listing day
- What is IPO GMP? Full form, meaning and how to calculate it
- Tax on IPO gains
More on gmp, listing day and tax
- Kostak and subject-to-sauda, explained
- Diwali muhurat trading 2026: date, timings and how it works
- Selling or holding IPO shares on listing day: what to weigh
- How to sell IPO shares: listing day step by step
- Is the IPO grey market legal? What it is and the risks
- How to calculate IPO profit: listing gain per lot and percentage
See today’s IPOs with live GMP and subscription
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.