AI Overview
What is IPO lot size? IPO lot size is the minimum number of shares you must apply for in an IPO. You cannot apply for fewer shares than one lot. SEBI mandates that the minimum IPO application for retail investors should be between ₹10,000 and ₹15,000. Companies set their lot size accordingly based on the issue price. Minimum investment = Lot Size × Upper Price Band. You can apply for 1, 2, 3 or more lots, but always in whole-lot multiples.
Introduction: Why Lot Size Determines How Much You Invest
When you apply for an IPO in India, you do not choose exactly how many shares to buy. Instead, you apply in units called “lots.” Each lot contains a fixed number of shares determined by the company before the IPO opens.
Lot size is one of the first things you check when evaluating an IPO because it determines your minimum investment amount and your maximum investment amount in the retail category. Getting this wrong leads to application rejection or investing more than you intended.
What is IPO Lot Size?
IPO lot size is the minimum number of shares per application unit in an IPO. Every application must be for at least one lot. If you want more shares, you apply for 2 lots, 3 lots, or more but always in exact multiples of the lot size.
You cannot apply for 1.5 lots or a fraction of a lot. Fractional applications are invalid and will be rejected.
Example:
- IPO: ABC Ltd
- Price band: ₹100 to ₹120
- Lot size: 125 shares
- Minimum investment (1 lot): 125 × ₹120 = ₹15,000
- 2 lots: 250 shares × ₹120 = ₹30,000
- 3 lots: 375 shares × ₹120 = ₹45,000
How is IPO Lot Size Decided?
SEBI’s guidelines require that the minimum IPO application amount for retail investors falls between ₹10,000 and ₹15,000. Companies set their lot size to comply with this rule.
The calculation works backwards from the price band:
Lot Size = ₹10,000 to ₹15,000 ÷ Upper Price Band (rounded to a whole number)
Example 1:
- Upper price band: ₹200
- ₹15,000 ÷ ₹200 = 75 shares
- Lot size: 75 shares
- Minimum investment: 75 × ₹200 = ₹15,000 ✓
Example 2:
- Upper price band: ₹500
- ₹15,000 ÷ ₹500 = 30 shares
- Lot size: 30 shares
- Minimum investment: 30 × ₹500 = ₹15,000 ✓
Example 3:
- Upper price band: ₹1,400
- ₹15,000 ÷ ₹1,400 ≈ 10.7 → rounded to 10 shares
- Lot size: 10 shares
- Minimum investment: 10 × ₹1,400 = ₹14,000 ✓
For SME IPOs, the minimum application size is typically ₹1 lakh or more. This is why SME IPO lot sizes are significantly larger than Mainboard IPO lot sizes.
IPO Lot Size and Retail Category Limits
The retail investor category (RII Retail Individual Investors) in an IPO is capped at a maximum application value of ₹2 lakh.
This means:
- If 1 lot costs ₹15,000, the maximum number of lots you can apply for in the retail category is ₹2,00,000 ÷ ₹15,000 = 13 lots (rounded down)
- If 1 lot costs ₹14,000, maximum lots = ₹2,00,000 ÷ ₹14,000 = 14 lots
If you want to invest more than ₹2 lakh in an IPO, you must apply in the NII/HNI category which has different allotment rules and different application requirements. See our IPO Subscription Status guide for how these categories work.
How Many Lots Should You Apply For?
This depends on your goals:
- For allotment probability (retail category): In oversubscribed IPOs, allotment in the retail category is done through a lottery system where each application (regardless of lot count) gets one chance. This means applying for 1 lot gives the same allotment probability as applying for 13 lots. In heavily oversubscribed IPOs, applying for 1 lot is often the rational choice you are spending less capital on the same probability of getting shares.
- For maximum shares if allotted: If you believe strongly in the IPO and want the maximum shares possible, apply for the maximum lots allowed in the retail category (up to ₹2 lakh).
- For HNI/NII strategy: Applications above ₹2 lakh follow a proportional allotment system more lots mean proportionally more shares if the category is subscribed.
See our How IPO Allotment Works guide for a detailed explanation of the lottery vs proportional allotment difference.
Lot Size Examples from Recent IPOs
| Company | Issue Price | Lot Size | Min Investment | Max Lots (Retail) |
| Company A | ₹75 | 200 shares | ₹15,000 | 13 lots |
| Company B | ₹250 | 60 shares | ₹15,000 | 13 lots |
| Company C | ₹1,500 | 10 shares | ₹15,000 | 13 lots |
| Company D (SME) | ₹100 | 1,200 shares | ₹1,20,000 | N/A (SME rules) |
Note: Exact lot sizes vary per IPO. Always check the current IPO’s prospectus or our IPO pages for accurate lot size data.
Common Mistakes Related to IPO Lot Size
- Applying for a non-multiple of lot size: If the lot size is 75 and you enter 80 shares, your application is invalid. Always apply in exact multiples: 75, 150, 225, etc.
- Confusing lot size with share quantity: The lot size is the minimum unit. If you want 150 shares and the lot size is 75, you apply for 2 lots and not enter “150 shares” directly in some fields and “75” in others.
- Ignoring the retail category cap: Applying for more than ₹2 lakh in the retail category is not allowed. Applications exceeding this are rejected. Check the maximum lots before submitting.
- Not having sufficient funds: Your bank account must have enough balance to cover the blocked amount. If funds are insufficient when the mandate is approved, the application fails.
Frequently Asked Questions
What is IPO lot size in simple terms?
It is the minimum number of shares per application unit. If the lot size is 50, you must apply for 50 shares, 100 shares, 150 shares, etc. You cannot apply for 30 or 75.
Why does SEBI mandate a minimum application size?
To ensure retail investors can participate in IPOs without needing large capital, while keeping per-share prices at meaningful levels for the company.
Can I apply for half a lot?
No. Fractional lots are not allowed. Every application must be in whole-lot multiples.
Is the lot size the same for SME and Mainboard IPOs?
No. SME IPO lot sizes are much larger, minimum applications are typically ₹1 lakh or above, compared to ₹10,000–₹15,000 for Mainboard IPOs.
Does applying for more lots improve my allotment chances?
In the retail category for oversubscribed IPOs: No. Each application gets one lottery entry regardless of lot count. In HNI/NII category: Yes allotment is proportional to application size.
Summary
- IPO lot size = minimum number of shares per application unit
- SEBI requires minimum investment of ₹10,000–₹15,000 for Mainboard retail applications
- Lot size is set by the company based on the upper price band
- You can apply for 1 to maximum lots allowed (up to ₹2 lakh for retail)
- In oversubscribed retail categories, applying for 1 lot gives the same allotment probability as applying for more lots
