The IPO Timeline — From DRHP to Listing

An IPO does not happen overnight. From the moment a company decides to go public to the day its shares start trading, the process typically takes 6–18 months. Each stage has defined participants, timelines, and regulatory requirements.

Understanding this timeline helps you know when to pay attention, what information becomes available at each stage, and how to time your research.

Stage 1: Internal Preparation (3–6 months before DRHP filing)

Before anything becomes public, the company spends months preparing internally:

Appointing advisors:

• Book Running Lead Managers (BRLMs): Investment banks that manage the entire IPO process. Large IPOs have 2–5 BRLMs. They conduct due diligence, prepare the DRHP, manage roadshows, and coordinate allotment.
• Legal counsels: Separate legal teams for the company and the BRLMs review all disclosures.
• Registrar to the Issue: Processes all applications, manages allotment, and handles refunds. Examples: Link Intime, KFin Technologies, Bigshare Services.
• Auditors: Restated financial statements must be certified by qualified auditors.

Internal restructuring: Many companies restructure their corporate entities, settle inter-company transactions, and clean up their books before filing. This is why the "restated financial statements" in the DRHP sometimes differ from previously published annual reports.

Stage 2: DRHP Filing and SEBI Review (30–75 days)

The company files the DRHP with SEBI (and simultaneously with BSE and NSE for listing). The DRHP is made public on the SEBI website — anyone can download and read it.

SEBI has 30 days to issue observations on mainboard IPOs. In practice, SEBI typically sends back a list of queries and required disclosures. The company responds, and SEBI issues its observation letter — effectively a clearance to proceed.

Important: SEBI's observation letter is NOT an endorsement of the IPO. It means SEBI is satisfied with the disclosures — not that the investment is good or the valuation is fair.

Stage 3: Pre-IPO and Anchor Allocation (1–2 weeks before opening)

Once SEBI clearance is received, the company can proceed. In the week before the IPO opens:

Anchor investor allocation: Up to 60% of the QIB portion can be allocated to anchor investors — large institutions (mutual funds, insurance companies, foreign institutional investors) who agree to buy shares at the IPO price one day before the issue opens.

Anchor allocations are disclosed publicly and create a pricing signal for the market. When marquee mutual funds participate as anchors, it is generally viewed positively — though it is not a guarantee of performance.

Anchor lock-in: 50% of anchor allocation is locked in for 90 days post-listing; the remaining 50% is locked in for 30 days.

Price band announcement: The final price band is announced, and the IPO is formally advertised.

Stage 4: IPO Subscription Period (3 days)

The IPO is open for exactly 3 working days (SEBI mandated). During these three days:

• Retail investors, HNI investors, and QIBs submit their bids
• Live subscription data is updated throughout each day by BSE and NSE
• You can track category-wise subscription in real time on ipomarket.in
• Bids can be modified or withdrawn during the subscription period
• The grey market premium (GMP) is at its most active during this period

Day 1–2: Retail and HNI subscription typically builds gradually. Day 3 (closing day): Subscription often spikes in the final hours as investors watch live data and make last-minute decisions.

Stage 5: Basis of Allotment (T+1 after close)

After the IPO closes, the registrar begins processing all applications.

For oversubscribed retail tranches, a computerised lottery is run — SEBI mandates that the draw be conducted in the presence of a public representative to ensure fairness.

The Basis of Allotment document is published on the registrar's website and on BSE/NSE. It shows exactly how many applicants were in each category, how many shares were available, and the allotment ratio.

Stage 6: Allotment and Refund (T+1 to T+2 after close)

• Successful applicants receive shares credited to their demat accounts
• Unsuccessful applicants receive their blocked amounts released back to their bank accounts
• Allotment status can be checked on the registrar's website or on ipomarket.in

Under SEBI's current timeline (T+3 listing), allotment happens within 2 days of IPO close.

Stage 7: Listing (T+3 after close)

Shares begin trading on the exchange exactly 3 working days after the IPO closes.

Listing day mechanics:

• Pre-open session: 9:00 AM to 9:45 AM — orders are collected, price is discovered
• Regular trading: Begins at 10:00 AM
• The listing price is determined by the pre-open session order matching

The listing price can be higher (listing gain) or lower (listing loss) than the issue price. This depends on demand, market conditions, GMP accuracy, and broader sentiment.

The Complete Timeline at a Glance

What Has Changed: T+6 to T+3

Until recently, the listing timeline in India was T+6 — shares listed 6 days after IPO close. SEBI reduced this to T+3 in 2023, cutting the time investors' money is blocked in unsuccessful applications from 6 days to just 3.

SEBI has signalled intent to move toward T+1 listing in phases, which would reduce capital blockage further and align India with the fastest IPO markets globally.

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