Yes, an individual investor can apply through a non-institutional category of an IPO given that they have enough influx to bid in the category.
There is no reason why an individual investor cannot apply in a NON-institutional investors category. But then, there are some clauses for a non-institutional bidder to adhere to if they want to invest in an IPO. But then who classify as non-institutional bidders?
NRI's, trusts, individual investors, companies, etc., who happen to bid for a category of an IPO but a minimum amount of one lakh rupees are categorized as non-institutional bidders. The requirements for registering with SEBI aren't required. For non-institutional bidders, there is a 15% allotment left in an IPO's build book, which might prove to be a flaw or disadvantage.
The 15% allocation reserved for only non-institutional bidders can prove to be a problem looking deeper into the disadvantages, with multiple bidders, its often oversubscribed to a whole new level which causes many of the bidders to get a lesser chance of having any bids placed and receiving a lesser number of shares. Compared to individual retail investors, they have 35% of the total shares from an IPO.
The good news is that there is no upper cap for any non-institutional bidder as long as they have the influx of money to be put into the IPO. Looking into the retail individual investor's category and the upper limit is only one lakh rupees.
To sum it up, yes, an individual can apply in a IPO as an non-institutional bidder.