IPO explained: what happens after you click “buy”?

You clicked subscribe. Money left your account. Are you a shareholder yet? Here is the part people often miss.

An IPO is a public offer of shares. It gives investors an opportunity to apply for ownership in a company under a defined offer.

Application

You select the number of shares you want and submit your application through an approved channel. This is the “I want these shares” stage.

Processing and allotment

After the offer closes, applications are processed according to the offer terms. Depending on demand and the rules in the prospectus, the number of shares allotted can be different from the number applied for.

Ownership

When shares are allotted to you, you have received the securities under the offer. The registrar and relevant market infrastructure handle the official records and settlement process.

Why the distinction matters

It is easy to post “I am a shareholder” immediately after applying. Technically, that wording should wait until your shares have been allotted. That is why this website has separate wording for applicants and shareholders.

And what about profit?

There is no automatic profit simply because a company is famous or because an IPO is popular. Share prices can rise or fall, and investors can lose money. The prospectus contains the company's detailed information and risk factors.