IPO (Initial Public Offering) is a very attractive topic among stock market investors. When a private company sells its shares to the general public for the first time, it is called an IPO. But not every IPO is the same. There are also many types of IPOs in India, which have their own process, features and implications for investors.
In this article, we will learn how many types of IPOs are there in India, how they work, what are their benefits and risks, and how investors can participate in them.
What is IPO? (Brief Introduction)
IPO (Initial Public Offering) is the process under which a private company offers its shares to the general public for the first time and gets listed on the stock exchange (eg NSE, BSE). Through this, companies raise capital, increase brand value and fund their expansion plans.
Major types of IPO in India
There are mainly three types of IPO in India:
1. Fixed Price IPO
In this type of IPO, the company fixes the price of its shares in advance. Investors are clearly told what the price of one share will be.
Features:
The price is fixed in advance (eg ₹ 100 per share)
The investor has to pay the full amount at the time of application
The status of oversubscription or undersubscription is known later
Example:
In 2017, Coastal Corporation Ltd brought an IPO through a fixed price offer.
2. Book Building IPO
This is the most common and modern method. In this, the company fixes a price band (eg ₹ 100 – ₹ 120) and investors place their bids within this range. The final price is decided based on the demand of investors.
Features:
The price of the share is decided on the basis of demand and supply
The price band is declared
The cut-off price is decided after bidding
Example:
Big IPOs like Zomato, Nykaa, LIC came under the book building model.
3. Dutch Auction IPO
In this, investors bid at their desired price. The company allots shares to only those investors who bid above the cut-off price.
Features:
The price of the share is completely based on the bid
More transparency
Rare in India but common in developed countries
Example:
Google (US) launched its IPO in 2004 with the Dutch auction model.
Dutch auction is currently used very rarely in India but it is likely to be used in the future.
Other classifications based on IPO
IPO can also be classified based on its objective or type of offer:
1. Fresh Issue
In this, the company issues new shares and the money received from it goes to the company.
Increase in share capital
Capital for expansion, repayment of debt or new scheme
2. Offer for Sale (OFS)
In this, the existing promoters or investors of the company sell their shares.
The capital does not go to the company
Only ownership is transferred
Example:
LIC’s IPO was brought in the form of OFS.
Types of IPO for investors
1. Retail Individual Investors (RII)
Investment up to ₹2 lakh
35% quota
2. HNI (High Net-worth Individual)
Investment more than ₹2 lakh
15% quota
3. QIB (Qualified Institutional Buyers)
Mutual funds, banks, insurance companies
50% quota
4. Anchor Investors
Come under QIB
Invest one day before IPO
Some important statistics related to IPO in India (as of 2025)
| Speciality | Statistics |
| Total IPOs (2025) | 66 companies |
| Total Capital Raised | More than ₹75,000 crore |
| Largest IPO | LIC – ₹21,000 crore |
| Top Sectors | Technology, FMCG, Healthcare |
| Retail Oversubscription | Average 6.8 times |
Some key statistics related to IPO in India (till 2025)
- Total IPOs: 66
- Total funds raised: ₹75,000 crore+
- Largest IPO: LIC – ₹21,000 crore
- Successful IPO: Tata Technologies (125% listing gain)
Conclusion
IPOs in India are a great opportunity for investors, but understanding the types is important to make the right decision. Fixed Price, Book Building and Dutch Auction—each type of IPO brings with it different benefits and risks. Also, understanding Fresh Issue and OFS is an important part of investment planning.
If you are a serious investor, the information in this article will make your decisions stronger. By understanding the IPO process, doing the right research, and adopting a long-term approach, you can become a successful investor in the stock market.
Frequently Asked Questions (FAQ)
Q1. Which is the most common IPO type in India?
A: Book Building IPO is the most common and popular method.
Q2. What is the main difference between Fixed Price and Book Building IPO?
A: In Fixed Price, the price is fixed upfront, while in Book Building, bidding takes place and the final price depends on the demand.
Q3. Can retail investors participate in all types of IPOs?
A: Yes, but eligibility may be limited in some OFS.
Q4. What documents are required to invest in an IPO?
A: PAN card, bank account, Demat account, and KYC are required.