When you've applied for an IPO, there might be instances where you wish to adjust your bid quantity or price, hoping to increase your chances of securing an allotment based on market demand. Occasionally, you might decide that an IPO isn't the right fit and choose to cancel your bid entirely.
The ability to cancel or modify an IPO application provides flexibility to investors. However, there are specific guidelines and limitations regarding when and how these changes can be made.
Rules for IPO Application Cancellation/Modification by Issue Type
Mainboard IPOs
- Only Retail Investors (RIIs) can cancel their IPO bids.
- Qualified Institutional Buyers (QIBs) and Non-Institutional Investors (NIIs) cannot cancel once their bids are placed.
- Retail investors can modify their bids to either increase or decrease their application size.
- QIBs and NIIs are allowed only to increase their bids, not decrease them.
- Changes can be made any time while the IPO is open for subscription.
- No alterations are permitted during the post-issue modification period.
SME IPOs
- The rules can vary based on the offer document (RHP).
- In some SME IPOs, individuals can cancel or revise bids similarly to mainboard RIIs.
- In other cases, cancellation isn't allowed, and only upward revisions (like QIBs and NIIs) are possible.
Rules for IPO Application Cancellation/Modification by Investor Category
| IPO Investor Category | Mainboard IPO Bid Cancellation Rule | Mainboard IPO Bid Modification Rule | SME IPO Bid Update Rule |
|---|---|---|---|
| Retail/Individual Investors | Bid can be cancelled. | Bid size can be increased or decreased. | Minimum application is 2 lots. Note: In some SME IPOs, cancellation isn't allowed; only upward revision is permitted, subject to RHP. |
| QIB | Bid cannot be cancelled. | Can only increase the bid quantity or price but cannot lower it. | Same as mainboard – only upward revision permitted. |
| NII | Bid cannot be cancelled. | Can only increase the bid quantity or price but cannot lower it. | Same as mainboard – only upward revision permitted. |
| Employee | Bid can be cancelled if the bid size is below Rs 2 lakhs. | Bid size can be increased or decreased if the bid size is below Rs 2 lakhs. | Minimum application is 2 lots. Bid size can be revised up to the employee maximum lot limit, with rules subject to RHP. |
| Shareholders | Bid can be cancelled if the bid size is below Rs 2 lakhs. | Bid size can be increased or decreased if the bid size is below Rs 2 lakhs. | Minimum application is 2 lots. Bid size can be revised up to the shareholder maximum lot limit, with rules subject to RHP. |
Note: Cancellations and modifications are allowed anytime while the IPO is open for subscription.
IPO Application Cancellation Process
Canceling or deleting an IPO application can be done online or offline. Online cancellations are generally quicker, but both methods require that the order is submitted to the exchange before changes can be made.
Steps for Online Withdrawal of IPO Application
- Log in to your broker platform or net banking account where the IPO application was made.
- Navigate to the IPO section.
- Select the IPO you wish to cancel.
- Click on 'Cancel/Delete/Withdraw Bid/Application'.
- Confirm your action.
- Revoke the UPI mandate if necessary.
Note: Sometimes, revoking the UPI mandate is required, and banks may refund the amount after the mandate expires. Always check with your bank for specific UPI procedures.
The broker forwards the cancellation request to the exchange between 10 am and 5 pm and updates the status once confirmation is received. You'll get an email once the cancellation is processed.
Steps for Offline IPO Order Cancellation
- Write a cancellation letter including:
- IPO application number
- Applicant name and details
- PAN number
- Sign the letter.
- Submit it to the intermediary through whom the application was submitted.
IPO Application Cancellation Time
You can withdraw from an IPO anytime while it's open for subscription. The exchange IPO bidding window runs from 10 AM on the issue open date until 5 PM on the issue close date. Always check with your broker or bank for specific deadlines, especially on the last day of bidding.
Important Note:
The online "Cancel/Withdraw" option is only available if the application was successfully submitted. If it's not visible, contact your bank or broker for assistance.
IPO Withdrawal Time
From 10 AM on the IPO open date to 5 PM on the closure date, cancellations can be made anytime during this period.
Note: Not all banks or brokers allow cancellations until 5 PM on the last day, often closing the window early to process requests. There are no fees for online or offline cancellations.
IPO Application Modification Process
Investors can alter their IPO bids if they wish to change the amount or quantity. Retail investors have the flexibility to either increase or decrease their bids, while QIBs and NIIs can only make upward adjustments.
Like cancellations, modifications can be made anytime while the IPO is open. Though the official window is from 10 AM on the issue open date to 5 PM on the close date, specific timing may vary by broker. Be particularly mindful of deadlines on the last day as not all brokers allow changes until 5 PM.
Changes can be made online or offline once the original bid is submitted to the exchange.
Steps to Modify IPO Bid Online
- Log in to your broker platform or net banking account.
- Go to the IPO section.
- Select the IPO you'd like to modify.
- Click on Modify Bid.
- Adjust your bid quantity or price.
- Confirm your changes.
- Approve the new UPI mandate. For ASBA applications, additional amounts get blocked for upward revisions, and amounts get unblocked post-allotment for downward revisions.
Steps to Modify IPO Bid Offline
- Obtain the IPO modification/revision form from a broker or download it from the exchange website.
- Fill in your personal details like Name, Address, Contact, Email, PAN, and DP details.
- Provide both old and new bid details.
- Include your ASBA account number or UPI ID.
- Sign the form.
- Submit it to the intermediary who handled the original application.
IPO Modification Form
Investors can download the IPO revision form from the BSE or NSE websites.
NSE provides an option to download either a blank revision form or a pre-filled one. For further details on the IPO application form, please refer to the IPO Application process Chapter.
IPO Application Rejection Reasons
Submitting a valid IPO application requires adherence to specific guidelines. Failure to comply can lead to rejection due to applicant, bank, or technical errors.
Common reasons for IPO application rejection include:
- Application by an ineligible applicant under company terms or the Indian Contract Act, 1872.
- Bid price falls outside the specified price band.
- Incorrect ASBA account number/UPI ID.
- Application submitted from another person's bank account.
- Mismatched PAN or DP details.
- Discrepancies between the applicant's name and those on DP and bank accounts or PAN.
- Bids lower than the minimum bid size.
- Multiple applications using the same PAN within the same investor category.
- Bidding at cut-off prices by NIIs or QIBs and individual investors in SME IPOs.
- Insufficient bank funds.
- Errors by intermediaries.
IPO Application Rejected But Amount Blocked
If an application is rejected post-mandate date, the blocked amount is released. Some banks might hold funds until the mandate expires. Investors should consult their bank or intermediary to confirm when funds will be released.
Page Glossary:
1. UPI Handle
A UPI handle is the identifier for the bank or payment app processing UPI payments. It's the virtual payment address used in UPI transactions.
Each mobile app has a unique UPI handle beginning with "@". For instance, a Paytm transaction uses the handle "@paytm". Check the list of mobile apps for UPI payment details.
2. DP ID
DP ID refers to "Depository Participant Identification", assigned by NSDL and CDSL to banks, financial institutions, or brokerage firms. Your demat account number consists of your customer number ID and the DP ID.
