Why IPO Mandate Revoked Before Allotment (IPO Allotment Process)


Why IPO Mandate Revoked Before Allotment Applying for an IPO can be exciting, especially when the grey market buzz is strong (think IPO Grey Market Premium Today).

But imagine the confusion if your bank informs you that your IPO mandate got revoked before share allotment! Fear not, fellow investor! This blog post will shed light on the possible reasons behind this and what you can do about it.

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What is an IPO Mandate and Why Does it Get Revoked?

An IPO mandate is basically your bank’s permission to block funds in your account for the IPO application amount. This gets revoked typically after allotment (when shares are assigned), but there are a few reasons it might happen earlier:

  • Technical Glitch: Sometimes, technical issues between the bank, broker, and registrar (the company handling the IPO) can lead to a premature revocation. Don’t worry, the funds will usually reappear in your account within a few days.
  • Application Error: Did you double-check your application details? Mistakes like incorrect PAN number, Demat account details, or exceeding the minimum bid amount can lead to rejection and mandate revocation.
  • Insufficient Funds: This might seem obvious, but ensure you have enough balance in your linked bank account to cover the applied amount during the entire application period.
  • Cancelled IPO: In rare cases, the company might decide to withdraw the IPO altogether. This will automatically revoke your mandate and unblock the funds

Read More:- IPO Allotment Algorithms: How They Work and What Investors Need to Know

Tips for IPO Application

The world of IPOs (Initial Public Offerings) can be thrilling, offering a chance to get in on the ground floor of a promising company. But with so much information (and sometimes misinformation) swirling around, a strategic approach is essential. Here are some key tips to streamline your IPO application process:

Preparation is Key:

  • Research, Research, Research: Don’t just chase the “hot” IPO. Diligently research the company’s financials, business model, management team, and industry trends. Understanding the company’s long-term prospects is crucial for informed decision-making.
  • Know the Allotment Process: Familiarize yourself with the specific allotment process for each IPO. Some rely on lotteries, while others prioritize retail investors. Understanding the system increases your chances of success.
  • Check Eligibility: Ensure you meet the eligibility criteria for the IPO category you’re applying under. Age, investment experience, and Demat account details might be factors.

Streamlining Your Application:

  • Apply Early (but Strategically): While applying early can give you a higher lottery number, avoid applying the moment applications open. Banks might process applications in batches, so applying just before a batch closes could be beneficial. (Check with your broker for specific timelines).
  • Utilize ASBA (Application Supported by Blocked Amount): This method blocks only the application amount in your bank account instead of debiting it upfront. Funds are deducted only if you get allotted shares.
  • Choose Cut-off Price (if applicable): Some IPOs allow bids at or above a cut-off price. Opting for the cut-off price avoids unnecessary overbidding and potential partial allotment.

Additional Considerations:

  • Multiple Demat Accounts (with Caution): While some utilize multiple Demat accounts to increase allotment chances, be aware that regulations often disqualify duplicate applications.
  • Beware the Grey Market: The “IPO Grey Market Premium Today” might be tempting, but it’s an unofficial indicator, not a guarantee of future performance. Focus on the company’s fundamentals, not just the hype.

Stay Informed, Invest Wisely!

Remember, a revoked mandate before allotment doesn’t necessarily mean bad news. By understanding the reasons and referring to this blog post as a handy guide, you’ll be well-equipped to navigate the IPO process with confidence. Keep an eye on “IPO Grey Market Premium Today” trends, but also prioritize researching the company’s fundamentals before investing. Happy IPO hunting!

Read More:- What is SME IPO, How to Apply for SME IPO – Boost your Investment Now

Q: My mandate got revoked. Does it affect my chances of getting the IPO shares?

Not necessarily. Revocation due to technical glitches won’t impact your application. However, if it’s because of an error in your application, then you won’t be considered for allotment.

Q: How can I find out the reason for the revocation?

Contact your broker or bank. They can access the details and provide clarification.

    Q: Can I reapply for the IPO if my mandate got revoked due to a technical glitch?

    Unfortunately, reapplying for the same IPO after a mandate revocation isn’t usually possible. However, you can always check for upcoming IPOs, especially SME IPOs (Small and Medium Enterprises) that might offer exciting growth prospects.

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