The shareholder quota in an IPO
When a listed company takes a subsidiary public, it often reserves part of the IPO for its own shareholders. If you qualify, it is an extra application with separate odds.
Who qualifies
Usually anyone holding at least one share of the listed parent or promoter company on a cut-off date given in the RHP, typically the date the RHP is filed. Shares bought after that date do not count.
The exact rules are in the RHP, under the reservation portion. Not every IPO has a shareholder quota.
How to apply
In your broker app, choose the shareholder category when bidding, using the same PAN and demat account that held the parent's shares. Bids up to ₹2 lakh can be at the cut-off price.
The shareholder quota is separate from the Retail and HNI categories, so in most issues an eligible person can apply in both the shareholder quota and one of Retail or HNI. Check the RHP for that issue's rules.
The odds
Shareholder quotas are often less oversubscribed than the retail portion, so the chance of an allotment can be better. IPO Khata records shareholder, employee and policyholder applications separately from retail.
Related guides
- IPO categories explained: retail, HNI (NII) and QIB
- How to improve your chances of an IPO allotment
- Can family members apply for the same IPO separately?
- The employee quota in an IPO
More on how ipos work
- IPO lot size, price band and cut-off price explained
- SME IPO vs mainboard IPO: what is different
- Anchor investors in an IPO
- DRHP, RHP and prospectus: what to read before an IPO
- IPO lock-in periods explained
- What is the HNI category in an IPO?
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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.