IPO Glossary
Quick definitions of terms you’ll see on every IPO page and grey-market chat.
DRHP
Draft Red Herring Prospectus — the draft offer document filed with SEBI before the IPO opens, without the final issue price.
RHP
Red Herring Prospectus — the updated prospectus after SEBI observations, used for marketing the issue; price band may still be pending.
GMP
Grey Market Premium — unofficial premium over issue price in the grey market. Unregulated and not a guarantee of listing performance.
Kostak
A grey-market rate paid for an IPO application regardless of allotment outcome — a way some traders lock a fixed premium.
Subject to Sauda
Grey-market deal where payment depends on receiving allotment. Riskier than Kostak because no allotment means no payout.
Anchor Investors
Large institutional investors who bid one day before the IPO opens to the public, providing demand signalling.
QIB
Qualified Institutional Buyer — mutual funds, FII/FPI, banks and other institutions with a reserved IPO category.
NII
Non-Institutional Investor (often called HNI) — applicants above the retail limit, typically bidding for more than ₹2 lakh.
Retail
Retail Individual Investor — bids up to ₹2 lakh (mainboard). Lot-based lottery when the retail category is oversubscribed.
About IPO Glossary
Plain-English IPO glossary: DRHP, RHP, GMP, Kostak, Subject to Sauda, anchors, QIB, NII and Retail.
How it works
Scan terms as you read RHPs and grey-market chats.
Practical tips
Use with the Learning Hub for fuller context.
Important to know
Definitions are simplified for clarity.
Frequently Asked Questions
- What terms are covered?
- DRHP, RHP, GMP, Kostak, Subject to Sauda, Anchor Investors, QIB, NII, Retail.
- Is GMP official?
- No. Grey Market Premium is unofficial and unregulated.