Can I apply for more than one lot in an IPO from a different demat account? How is this possible and how can I do this?

I want to apply more than once in an IPO. I have already used one demat account for this. Now I want to use another demat account and apply for the same IPO. Is it possible? Or will it lapse? Can anyone tell me?
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Short Answer

Yes!, one can apply 1 Lot from different Demat accounts but they have to make sure that the other Demat account should not be mapped under their name or PAN Card. If one applies through 2 or more Demat accounts that are mapped under their name then all of the applications will get rejected.

Detailed Answer

In short Yes!, you can apply for more than 1 Lot from different Demat accounts but there are some points that you should keep in mind while applying for an IPO.

  • Never apply from more than 1 Demat account from the same PAN number- According to SEBI 1 retail individual cannot apply for 1 IPO from more than 1 Demat account which is mapped under one PAN Number. This means that if you have a Demat account with Zerodha and Upstoxx at the same time then you can apply for an IPO only through any one of them. If you apply from both of them then both of the applications will get rejected and you will not be allotted any shares.
  • When an IPO is subscribed the maximum Lots that a Retail investor can be allotted is 1Lot- This is another important point that every person applying under the RII (Retail Individual Investor) should know. If an IPO is oversubscribed in the RII category then no matter how many Lots one has applied for, they will get a maximum of 1 Lot if they are have been successfully allotted the shares. So if you have applied for 3 Lots from your account and that specific IPO gets oversubscribed then even if you get the allotment of the shares then the maximum number of shares that you are going to get is 1 Lot.

Can I apply for more than 1 Lot in IPO from different Demat accounts?

Now, to answer the question of how to apply for multiple Lots from different Demat account-

To increase the chances of allotment under the RII category where the allotment is finalized through random picking which is also known as the Lottery system, you can apply for 1 Lot each from a different Demat account that is not under your name.

For example, If you apply for 1 Lot from your Demat account, apply 1 Lot from any other of your family member’s accounts or any of your friend’s accounts. In this way, you will be able to increase your chances of allotment in an IPO.

Applying multiple applications is obviously permissible but there are certain restrictions that you have to be careful about.

You cannot apply under different categories. It means that if you are an individual investor then you have no right to apply under the HNI category. If found, all your applications will be rejected.

  • Applying the same IPO through different brokers is also not allowed. So, you have to choose a single broker and then apply via him only.
  • You cannot ignore the rule- One application One PAN . Breaking it or changing combinations is also not allowed.
  • Similarly, you will not be allowed to apply for multiple applications through a single UPI account.

To increase the chances of allotment, you should always use the Cut-Off price while applying for an IPO, as the Retail investors only have the luxury of applying at the Cut-Off price. Just by selecting the Cut-Off price, you outbid the investors who have placed a bid lower than yours. In this way, you can make sure that you have done your best to increase the chances of allotment of an IPO.

Tagged With: ipoapply ipodemat accountipo basics
Categories: IPO Basics
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