How IPO allotment works for retail investors

You applied for a popular IPO, the money was blocked, and then you got nothing. That is normal — and understanding how allotment works explains why, and what actually improves your chances.

The investor categories

Every IPO splits its shares into categories, each allotted separately:

Retail individual investors (RII): individuals applying for up to ₹2 lakh
Non-institutional investors (NII / HNI): individuals and others applying for more than ₹2 lakh
Qualified institutional buyers (QIB): mutual funds, banks, insurers and similar institutions
Some issues also reserve shares for employees or existing shareholders

The share of each category is fixed in the offer document, so demand in one category does not change how many shares another gets.

When the retail category is oversubscribed

If retail investors apply for fewer shares than are on offer, everyone gets what they applied for. Popular IPOs are usually oversubscribed many times over, and then a rule kicks in: as many retail applicants as possible get the minimum lot, chosen by a computerised lottery.

In practice:

If there are enough shares to give every valid applicant one lot, everyone gets one lot, and any remaining shares are shared out among those who applied for more.
If there aren't enough for everyone to get even one lot, a lottery picks which applicants get one lot. Everyone else gets nothing.

In a heavily oversubscribed IPO, applying for ten lots instead of one does not give you ten chances. Each valid application is one entry in the lottery.

What actually improves your odds

Since each application is one lottery entry, what matters is the number of separate, valid applications — not their size. That's why families often apply from several members' accounts, each with their own PAN, demat account and UPI ID.

What does not work:

Applying twice with the same PAN — duplicate applications are rejected
Using one person's UPI ID for another person's application — the payment account must belong to the applicant

And make sure every application is valid: correct PAN and demat details, and the UPI mandate approved before the deadline. A mandate that isn't approved in time means the application doesn't count.

The timeline after the issue closes

IPOs in India follow a T+3 timeline, where T is the day the issue closes:

T: the issue closes; UPI mandates must be approved by the deadline that day
T+1: the basis of allotment is finalised
T+2: shares are credited to the demat accounts of successful applicants, and money is released for everyone else
T+3: the shares list on the stock exchange

You can check your allotment status on the registrar's website or the exchange's website once the basis of allotment is final.

Tracking it for the whole family

If several family members applied, checking each one on the registrar's site gets tedious. Allotly keeps every member's application in one list and lets you refresh the allotment status for all of them together, so you can see at a glance who got shares.

This article explains general rules for IPO allotment in India. Check the offer document of each IPO for its exact terms, and invest according to your own judgement.