IPO Grey Market Premium

The IPO GMP (IPO Grey Market Premium) represents the price at which grey market investors are willing to pay for a particular stock. Grey market (also known as grey market) is a non-recognized stock exchange that allows traders to purchase and sell shares in an informal setting.

ipo gmp

Because the IPO GMP indicates the premium someone is prepared to pay, it is frequently used to estimate the price of a public offering’s debut. Although not always accurate, the GMP of some IPOs has reliably anticipated ultimate listing prices.


Latest Upcoming IPO GMP Today (7 March, Prices in INR)

IPO Price GMP Open Date Close Date Listing date

VR Infraspace 85 10 4March 6 March 12 March
Sona Machinery 143 100 5 March 7 March 13 March
JG Chemicals 221 27 5 March 7 March 13 March
Shree Karni Fabcom 227 250 6 March 11 March 14 March
Gopal Snacks IPO 401 20 6 March 11 March 14 March
Koura Fine Diamond 55 65 6 March 11 March 14 March
Pune E-Stock Brokring 83 83 7 March 12 March 15 March
Pratham EPC Project 75 90 11 March 13 March 18 March
Signoria Creation NSE SME 65 50 12 March 14 March 19 March
Popular Vehicles & IPO 295 30 12 March 14 March 19 March

An IPO gray market transaction involves an unofficial agreement between an IPO investor and a stockbroker, allowing investors to secure profits before the stock lists. In this system, shares allotted to IPO applications are sold by brokers without transferring the shares to their accounts. This arrangement relies entirely on trust between the investor and broker.

Key Points about IPO GMP and the Grey Market:

The IPO grey market is volatile, and rates may change rapidly. It’s risky to base investment decisions solely on grey market IPO rates. Refer to our research and analysis section for more reliable information. Retail investors tend to overreact to market sentiment, especially concerning IPO investments. It’s essential to approach investments wisely. IPO GMP rates provided are based on market intelligence and may vary depending on location, market conditions, and dates. We do not engage in grey market trading or facilitate the buying or selling of IPO forms.

Understanding IPO GMP (IPO Grey Market Premium):

IPO GMP represents the per-share premium an IPO commands in the grey market before listing. Simply put, it indicates the price grey market buyers are willing to pay above the allotment price set by the company. A positive GMP suggests that the offer is likely to list at higher prices, benefiting successful applicants, while a negative GMP indicates a potential listing at lower rates.

The grey market operates informally from the IPO’s start date until the listing date. GMP fluctuates daily based on IPO demand, similar to the primary and secondary markets. GMP tends to rise in buoyant market conditions and fall during subdued periods. For those interested in monitoring IPOs, IPOINVEST provides valuable insights.

Understanding Kostak Rate:

The Kostak rate is the amount an investor receives by selling their IPO application in the grey market. This amount is guaranteed, regardless of the IPO allotment status. For instance, a Kostak rate of INR300 means the investor will receive this amount even if there is no allotment or if the stock lists at a discount.

Understanding Subject to Sauda:

“Subject to” denotes a sauda (deal) for buying a firm allotment application in the grey market. Buyers are willing to pay a significant premium for an application that has been allotted shares. However, if there is no allotment, the sauda is canceled. There’s a trade-off between Kostak and Subject to Sauda trades, with the latter offering potential for higher returns but also carrying greater risk.

Income Tax Implications: Since the grey market is informal, all profits are attributed to the IPO applicant who sold their application. Trades are typically settled in cash, placing the tax liability on the applicant.

IPOINVEST offers comprehensive research, recommendations, and discussions for retail and HNI investors. Investors can access brokerage reports, analysts’ insights, and detailed examinations of upcoming IPO GMPs in India. Engage in lively discussions and stay informed about current, forthcoming, and recently closed IPOs. If you spot a new IPO, feel free to notify us in the comments or via email.