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IPO Cut-off price is the share price decided by the company based in the demand of IPO shares.
Cut-off price is the price, finalized by the company, is the price within the Price Band of a book-building IPO. Applying on Cut-off price means the investor is ready to pay whatever price is decided by the company at the end of the book-building process.
When applying at a cut-off price, an investor has to pay the highest price while placing the bid. If a company decides the final price lower than the highest price asked for IPO, the remaining amount is returned to the retail investor.
Many retail individual investors who are unable to decide the best price to bid at for an IPO, tend to select the cut-off price option. This indicates their willingness to apply for a particular IPO at any price within the price band. It also increases their chances of getting an allotment.
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Note: Check the IPO prospectus document to check the eligibility before you apply.
Note: Please read the RHP document of the IPO to check the eligibility before you apply.
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