IPO & Stock Market Glossary
Demystifying complex financial jargon. Learn the definitions, implications, and calculations behind the most common terms in public offerings and markets.
Grey Market Premium (GMP)
The unofficial premium price at which IPO shares are bought and sold before listing.
Kostak Rate
The profit amount paid to buy an IPO application before the allotment is declared.
Subject to Sauda
An IPO grey market deal that is valid only if the seller receives the share allotment.
ASBA (Application Supported by Blocked Amount)
An application mechanism where funds are blocked in the bank account instead of debited.
Cut-off Price
The final offer price decided by the company at the end of the bidding period.
Red Herring Prospectus (RHP)
A detailed preliminary document containing company financials and IPO offering details.
Draft Red Herring Prospectus (DRHP)
The draft prospectus submitted to SEBI for review and feedback before final filing.
Lot Size (Bid Lot)
The minimum number of shares that an investor must bid for in an IPO application.