Initial Public offering or IPOs are also one of the features of the share market wherein the company issues or offers its shares to the market for the first time. After that, the shares can be freely traded in the open market. There are many players in market who offer these trading facilities. But “Zerodha” is one of the popular trading applications and India’s largest stockbroking company that enables us to trade with no dependency on any other stock broker. Have a quick look at the process to apply for IPO through Zerodha and also through different banks.
Of course, the initial step is to open an account with Zerodha, if you wish to apply an IPO through it. And, if you don’t have it, you can easily open an online demat and trading account with Zerodha. Next, you will require a UPI account. (Keep reading to grab further info!)
Now, let’s go ahead and learn more about the procedure of applying an IPO with Zerodha.
Process to Apply IPO with Zerodha
If you are a Zerodha customer, you can apply to IPOs with the help of any supported UPI (Unified Payment Interface) app through its back-office Zerodha console. We can summarize this in 3 simple steps namely:
1. UPI ID Creation:
Create UPI ID on BHIM App or using mobile banking apps of a bank like HDFC, ICICI, etc. (where you have an account). The process of applying through Net banking has been explained in detail below.
2. Login to Zerodha Kite:
- You have to go to Zerodha Console using your UPI ID
- Select Console > Portfolio > IPO
- Choose the desired IPO from the list and Apply
- Enter your UPI ID
- Fill Bid details like quantity, price, etc.
- Submit your application
3. Accept UPI Mandate:
When you apply, after sometime (generally at the end of the day) you’ll get a mandate request on your BHIM UPI App or your net banking app. You just have to approve the mandate with UPI PIN. Click “Proceed” and it’s done.
Simply speaking, once you create your UPI ID, it’s gets easier to apply to an IPO. Or we can say, apply for an IPO online and pay using a UPI enabled app. To sum up, you can use your UPI ID as your payment option when you subscribe for an IPO on NSE or BSE.
That’s was an overview! Here are deeper insights on applying IPO (with Zerodha through UPI and with banks without UPI).
How to Apply IPO with Zerodha through UPI?
Here’s the step-by-step process of applying IPO through UPI is as below:
- Download the UPI application on your mobile. Login to your Zerodha Kite (Console).
- Select IPO from the available option from “Portfolio” menu.
- On the next screen, select the IPO which you want to invest into, once selected you would be able to see all details like issue size, close & open dates, minimum order, etc.,
- You need to enter your UPI ID and click on “verify”. Make sure the bank account linked to UPI ID is yours or else the system will reject the login if the details don’t match.
- Once verified, select your bids i.e. price, quantity, etc and submit.
- Once you have submitted your request you’ll receive a mandate request on your UPI app which you need to accept. Once accepted, the funds would be blocked in your bank account until the date of allotment.
- If your bid matches the IPO then the amount would be debited and the shares would be credited to your Demat account. Or else the blocked money is released for your normal usage.
You may also like: Zerodha Review: Account Opening, Brokerage & Margin
How to Apply in IPO without UPI?
While Zerodha offers a UPI based IPO application only. In general, you can also apply to IPOs using Net banking of the bank where you hold an account. SEBI (Securities Exchange Board of India) has listed the banks (Self Certified Syndicate Banks) through which retail investors can invest in IPOs online.
Some of the said banks include:
- SBI Bank
- Kotak Bank
- Axis Bank
- HDFC Bank
- ICICI Bank
So, all you need here is a bank account and a Demat account!
Hence, you need to link your bank account (of course, with an approved bank). Ensure that the PAN used in bank account and Demat account matches or else the linking would not go through.
- Login to your net banking e.g. SBI online account
- Click “e-services”
- Select “Demat & ASBA (Application Supported by Blocked Amount) Services”
- Click on IPO Equity
- You need to enter the required details on the screen (like name, PAN, etc) and then select the IPO which you want to invest into, once selected you would be able to enter your bid and confirm.
- After keying all details and confirming the details, you will get your bid application.
Remember, under ASBA payment method, your application amount isn’t debited, but blocked as lien.
The Bottom Line
Zerodha, one of the leading discount brokers in India is growing as company and has expanded its huge customer base. It launched its Online IPO applications and is offering IPO through UPI as a payment method since August 2019. Apart from facilitating such IPO transactions, Zerodha portal also offers investing in stocks, derivatives and mutual funds.
Easy Online IPO applications is a relief for retail investors. Have you applied for an IPO recently? Do share your feedback on the IPO application and allotment process.