IPO application is moderately safe idea to enhance return on the balance in your savings account. It works like this. You can apply for IPO online, invest minimum subscription amount for a few days. If you are allotted the shares, you can sell those shares in market after the day of allotment or keep invested depending upon your outlook and risk appetite.
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We herewith summarize useful information about upcoming IPOs in year 2021.
|IPO||Tentative Issue Size (in Rs Crores)*||Tentative Date*|
|LIC||70,000||—||Life Insurance Corporation of India’s (LIC) IPO is going to be India’s largest-ever public issue in India. The divestment in LIC was announced by the Finance Minister, Nirmala Sitharaman in the 2020 Union Budget.|
|Nykaa||—||2021-22||In a first by an online beauty market place, Nykaa is looking at a stock exchange listing by the end of 2021 or early 2022 at a valuation of $3 billion.|
|Indian Railway Finance Corporation (IRFC)||4,600||January 2021||IRFC primarily is in the business of financing asset creation or acquisition for the Indian Railways or any other business/entity under the Ministry of Railways. In its words, it is the “dedicated financing arm” for the railway’s ministry.|
|Indigo Paints||1,000||January 2021||The issue size is expected to be around Rs 1,000 crore, of which fresh issue may be worth Rs 300 crores whereas the rest will be an offer for sale. The company may use the proceeds from the IPO to expand existing manufacturing facilities.
|RailTel||700||January 2021||RailTel is planning to launch its IPO sometime this year with 8.66 crore shares on offer. The IPO size is worth almost Rs 700 crores and most probably is a complete offer for sale.
The company was incorporated in 200 and it provides telecom network and infrastructure services.
The company is a Central Public Sector Enterprise (CPSE) and a Mini Ratna company.
|Kalyan Jewellers||1,750||January to March, 2021||Kalyan Jewellers, a jewellery brand based out of Kerala, is planning to raise around Rs 1,750 crores through its IPO. It was earlier expected to launch its IPO in December 2020.
The IPO may consist of a fresh issue of Rs 1,000 crores and the rest would be an offer for sale.
|Bajaj Energy||5,450||2021||The IPO size of the company is expected to be around Rs 5,450 crores, of which Rs 5,150 crores will be a fresh issue. The company has said that it is looking to acquire Lalitpur Power’s 1,980 MW from the proceeds of the IPO. Any amount left will be used for general expenses.
|Studds Accessories||450||February 2021||The company is a manufacturer of helmets, motorcycle accessories and riding gears. Studds had begun its operations in 1973.
The company’s managing director had said in an interview in August 2020 that the company has an approximate market share of around 30%, which it aims to scale to 40% in the next three years.
|Suryoday Small Finance Bank||400||2021||Suryoday Small Finance Bank is planning to launch an IPO of 2 crore equity shares which comprises a fresh issue of 1.6 crore shares and the rest is offer-for-sale. The approximate IPO size is Rs 400 crores.
The bank has branches in Maharashtra, Gujarat, Madhya Pradesh, Tamil Nadu, Delhi, Karnataka and few other states and union territories.
|Laxmi Organic Industries||800||—||The IPO size is worth Rs 800 crores approximately, of which the fresh issue is worth Rs 500 crores and the rest is offer-for-sale.
Laxmi Organic is a specialty chemicals company. It’s peers Rossari Biotech and Chemcon Specialty were subscribed 80 and 149 times respectively and listed in 2020.
|Craftsman Automation||150 +||—||The IPO will have a fresh issue of Rs 150 crores and an offer for sale of 45.21 lakh shares. The IPO proceeds may be used for clearing some of the debt and general corporate purposes.
The company manufactures auto components.
|Barbecue Nation||1,000-1,200||2021||Barbecue Nation, which operates a chain of restaurants across many cities, is planning to raise Rs 1,000-1,200 crores through its IPO issue.
Of the total issue size, around Rs 275 crores will be a fresh issue. The IPO proceeds may be used for outstanding borrowings and corporate purposes.
The company operates more than 130 outlets in India.
|Apeejay Surrendra Park Hotels||1,000||2021||The hotel chain may raise up to Rs 1,000 crores in its IPO. The IPO may comprise a fresh issue of up to Rs 400 crores and an offer-for-sale (OFS) of up to Rs 600 crores.
Park Hotels have a presence in most metro cities.
|Home First Finance Company||1,500||2021||Home First will be raising around Rs 1,500 crores through an IPO, of which, Rs 400 crores will be a fresh issue and the rest will be an offer for sale.
The proceeds may be used to enhance capital base and growth opportunities.
The company is a mortgage financier.
|Shyam Steel||500||2021||The IPO size will be around Rs 500 crores, which will be a combination of an offer for sale and fresh issue.
The company is based out of Kolkata and plans to see the proceeds to repay borrowings and general corporate purposes.
Shyam Steel operates all its steel manufacturing plants in West Bengal itself.
|Annai Infra Developers||200-250||2021||The IPO size is expected to be around Rs 200-250 crores.
The company is an engineering, procurement and construction firm in the water management and irrigation segment specifically.
|*Both, the issue size and date, is tentative and might vary once the issue goes live in the markets.|
Here is an important general knowledge about IPO applications.
Initial Public Offering (IPO) is the issue of shares to the public for the first time and the listing of stock exchanges. It can be a fresh issue of shares, an offer for sale by the existing shareholders or a mixture of both. The application for subscribing to the IPO can be done both online & offline modes.
How to apply for IPO online?
The following are required for applying for IPO:
- Demat account – To hold your shares.
- Trading account – To sell your shares.
- UPI ID – To block funds in your bank account.
In order to open a demat account, you must get in touch with a SEBI registered Depository Participant (DP). The DPs can be banks or brokers.
You must possess a trading account which is used to place buy or sell orders in the stock market.
UPI stands for Unified Payment Interface which is a unique id that allows you to carry out digital transactions.
Here are the key steps to apply for an IPO online:
- Login to your trading platform and select the desired issue (company) in the Current IPO section.
- Enter the number of lots and price at which you wish to apply for IPO.
- Enter your UPI ID and click on submit. Once you complete this step, your bid will be placed with the exchange.
- After this, you will receive a notification to block your funds in your UPI app. You should now approve the block request.
- Once you approval is successful, the required amount will be blocked in your bank account.
- This is followed by allotment, where the blocked amount will be deducted from your bank account and the shares will be credited into your Demat account. If there is any extra amount which is beyond the extent of shares applied but is not allotted, it will be unblocked by your bank.
How to apply for IPOs offline?
To submit an offline application, you must visit the designated collection centre ( Self Certified Syndicate Banks: SCSB) and submit the completed application form.
You would be required to fill in the following details:
- PAN number
- Demat number
- Bid quantity
- Bid price
Once you submit these details at the SCSB, the bank will upload the details of the aspects in the bidding platform. It is important that you provide the correct details so that the application is not rejected.
How to make money in IPOs
- For retail investors, in case of over subscription, it is important to note that allotment is done on a lottery basis. Therefore, it is advisable to apply for lots from multiple family accounts rather than applying for more lots from a single account.
- In order to increase the chance of allotment, it is advisable to place the IPO bid price at a cut off as opposed to selecting a lower price for the IPO. This implies that you are ready to buy the stock at the decided final price.
- Grey market premium (GMP) refers to the premium at which the people are ready to pay for the shares even before the stock is listed on the exchange. A high GMP signifies a higher demand in the market and benefits from getting more listing gains and is also an indicator of how the IPO will behave in the market.
For further details, you can refer to the Red Herring prospectus. You are highly advised to thoroughly read the risk factors before applying.