By BillCut
Last updated: 3 November 2026
The IPO allotment process decides which bids receive shares once an issue closes and the exchange approves the basis of allotment. If demand is lower than the shares on offer, bids are generally met in full. If demand is higher, shares are shared out by a set method. This guide explains that method in plain words. BillCut is a debt platform, not an investment adviser, so this is general education and not a view on any issue.
What happens after an IPO closes?
The registrar to the issue checks the bids, removes invalid ones and prepares the basis of allotment with the merchant banker. The stock exchange then approves it. SEBI investor education material says that an oversubscribed issue is allotted on a proportionate basis or by lottery, and that the basis is finalised by the merchant banker and registrar and approved by exchange officials.
Money is handled through ASBA. SEBI explains that the amount equal to the bid is blocked in your own account until allotment. If shares are allotted, the required amount is debited. If not, the blocked money is released.
What does oversubscription mean?
An issue is oversubscribed when total demand is higher than the shares offered. SEBI training material illustrates this with 5,000 shares demanded against 3,000 on offer.
| Situation | What it generally means for allotment |
|---|---|
| Demand below shares on offer | Valid bids can be met in full, as set out in the offer document |
| Demand above shares on offer | Allotment is proportionate, or decided by draw of lots where the share falls below the minimum lot |
| Bid invalid or withdrawn | No allotment, and the blocked amount is unblocked |
How are shares allotted in the retail category?
Issues divide shares into investor categories, such as retail individual investors, non-institutional investors and qualified institutional buyers. Each category is allotted separately. The SEBI General Information Document, which applies to public offers, explains the retail method in steps.
- The shares reserved for retail are divided by the minimum bid lot. This gives the number of retail applicants who can receive one minimum lot.
- If valid retail applicants are at or below that number, each gets the minimum lot. Any leftover shares go proportionately to those who bid for more.
- If applicants are more than that number, a draw of lots decides who receives the minimum lot.
You can read this in the SEBI General Information Document for public offers. The same document says proportionate allotments are rounded to whole shares, and that where the document and the offer specific prospectus differ, the prospectus prevails. The minimum bid lot and the price band differ for every issue, so check them in that issue’s own offer document.
What is a lot, and why does it matter?
A lot is the minimum number of shares you can bid for, and bids are made in multiples of it. Because retail allotment is built around the minimum lot, a draw of lots can decide whether you receive one lot or nothing in a heavily subscribed issue.
How can you check your allotment status?
The offer document names the registrar and the allotment dates. Registrar and exchange pages generally let you search by application number or PAN. Keep these ready.
- Full name as in your records and PAN
- Application number and bank or UPI details used for the bid
- DP ID and client ID of your demat account
- Number of shares applied for and the amount blocked
Where do you complain if allotment goes wrong?
The SEBI General Information Document says issues on allotment, missing allotment advice, share credit or unblocking go first to the registrar to the offer. SEBI’s investor material adds that if the registrar does not resolve it, you can complain on SEBI SCORES. Read the SEBI guide on how to invest in an IPO for the steps. UPI based bidding is covered in this UPI explainer.
What should you remember about risk?
Allotment is not a signal of quality, and non-allotment is not a loss of money. Listed shares can fall as well as rise. Decide using the offer document and your own situation, and talk to a SEBI registered adviser if you need advice. Avoid unofficial tips. For safety around payments, see how UPI blocking mandates work and simple UPI safety steps.
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How BillCut can help
BillCut is a balance transfer and debt reduction platform. It works with lending partners to help eligible borrowers move high interest dues, such as credit card balances and personal loan EMIs, into one structured EMI. BillCut earns from helping borrowers refinance, so it has an interest in this option. Approval and terms depend on the partner lender.
Frequently asked questions
What is the basis of allotment?
It is the method finalised by the issuer, merchant banker and registrar, and approved by the stock exchange, that decides how shares are shared among valid bids in each category.
Is allotment by lottery?
In an oversubscribed issue, shares are allotted proportionately, and where the share falls below the minimum lot a draw of lots decides who gets the minimum lot, as per the SEBI document.
Does bidding for more lots raise my chance?
Not reliably. Retail allotment is built around the minimum lot, so check the method in the offer document.
What is the minimum bid lot?
It is fixed for each issue and stated in its offer document. Do not rely on a number from social media.
What happens to my money if I get no shares?
The amount blocked through ASBA is unblocked in your account. No separate refund process is needed for non-allotment, as SEBI explains.
Who handles allotment queries?
The registrar to the offer handles allotment, share credit and unblocking queries first. SEBI SCORES is the next step if the issue is not resolved.
Can I apply through UPI?
SEBI material says investors can use UPI as a payment mechanism in IPOs. Check your broker or bank app for how it works.
Disclaimer: This article is general education and not investment, tax or legal advice. It does not recommend applying for, buying, selling or holding any security. Investments in securities are subject to market risks, and you can lose money. Read the offer document of any issue before you decide.
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