DRHP to Listing: The Complete IPO Timeline Explained

What Is a DRHP?

DRHP stands for Draft Red Herring Prospectus. It is the first formal public document a company files when it decides to go public through an IPO. The DRHP contains comprehensive information about the company — its business model, financials, management, risks, and the structure of the proposed offering.

The document is filed with SEBI (Securities and Exchange Board of India) and simultaneously made available on SEBI's website and the stock exchanges' websites. This is a public document — anyone can download and read it.

It is called a "Red Herring" Prospectus because it is not the final document. The price band and issue size are typically left blank (or indicated as ranges) in the DRHP. These are filled in the final Red Herring Prospectus (RHP), filed after SEBI gives its observations.

Stage 1: DRHP Filing with SEBI

Before filing the DRHP, the company appoints Book Running Lead Managers (BRLMs) — investment banks like Kotak, Axis Capital, Goldman Sachs, or similar — who structure the offering and draft the document. This pre-filing preparation can take 3 to 12 months depending on the complexity of the business.

Once the DRHP is complete, it is filed electronically with SEBI through the SEBI Intermediary Portal (SIP). The filing fee depends on the issue size.

At this stage, the company also files with BSE and NSE (the proposed listing exchanges) to begin the exchange-level due diligence process in parallel.

• ▸Typical timeline to prepare DRHP: 3–12 months
• ▸DRHP is publicly available on sebi.gov.in within 7 days of filing
• ▸Multiple BRLMs are appointed for larger IPOs (global coordination + domestic distribution)

Stage 2: SEBI Review and Observations Letter

After receiving the DRHP, SEBI has 30 days to issue its observations — a letter that signals SEBI has no further comments and the company may proceed with the IPO. In practice, SEBI often asks follow-up questions or requests clarifications, which can extend the total review period.

SEBI's observations are not an "approval" in the sense of certifying the investment — SEBI explicitly states that its observations do not indicate the merits of the issue. SEBI is verifying disclosures, not endorsing the business.

During the review period, the company cannot market the IPO to investors. Any publicity or roadshows before SEBI issues its observations is prohibited.

Stage 3: RHP Filing and Price Band Announcement

Once SEBI observations are in hand, the company finalises the offer structure and announces the price band — the range within which investors can bid. For example: ₹490 to ₹500 per share. The final allocation price is determined by the book building process.

The final Red Herring Prospectus (RHP) is filed with SEBI and the Registrar of Companies (RoC). The RHP includes all DRHP content plus the price band, issue size, and key dates.

This is also when anchor investor allotment happens — the day before the IPO opens. Large institutional investors (mutual funds, insurance companies, FPIs) are allotted shares at the IPO price, providing a price anchor for the subscription period.

• ▸Price band is announced 2 working days before IPO opens (regulatory requirement)
• ▸Anchor investor allotment happens 1 working day before subscription opens
• ▸Anchor allotment details are publicly available — check the exchange website for this data

Stage 4: IPO Open for Subscription — 3 Days

The IPO is open for public subscription for exactly 3 working days. During this window, investors can apply through their bank's ASBA facility, UPI-linked brokerage apps, or net banking.

The subscription is divided into three categories: Qualified Institutional Buyers (QIBs), Non-Institutional Investors (NIIs, bids above ₹2 lakh), and Retail Individual Investors (RIIs, bids up to ₹2 lakh). Each category has a separate reservation.

Subscription data is updated daily on BSE and NSE. Checking subscription progress during the 3 days helps investors gauge demand — though it should not change a fundamentally sound investment decision.

• ▸Apply only through ASBA or UPI — your funds are blocked, not debited, until allotment
• ▸You can modify or withdraw your bid before the subscription closes
• ▸Multiple applications from the same PAN are rejected; bid through only one application
• ▸Maximum retail bid: ₹2 lakh (one lot to multiple lots within this cap)

Stage 5: Allotment — T+6

After subscription closes (Day T), allotment happens on T+6 working days. The registrar to the IPO runs a computerised lottery for retail investors when the issue is oversubscribed.

For oversubscribed retail portions, the lottery ensures each successful applicant receives exactly one lot (the minimum bid quantity). This is why applying for multiple lots does not significantly improve your allotment chances in heavily oversubscribed IPOs.

Allotment status can be checked on the registrar's website (e.g., Link Intime, KFin Technologies), the exchange websites, or through your broker. Unallotted funds are unblocked from your bank account within 24 hours of allotment.

• ▸Allotted shares are credited to your demat account on the allotment date
• ▸Check allotment at registrar website using your PAN or application number
• ▸Refunds for non-allotted amounts are processed automatically — no action required

Stage 6: Listing Day — The New T+6 Timeline

Before 2023, IPO listing happened on T+10 (10 working days after subscription closed). SEBI reduced this to T+6 in December 2023 to shorten the time investors' money is locked up and reduce uncertainty.

Listing happens simultaneously on BSE and NSE (for companies listed on both). Pre-open session runs from 9:00 AM to 9:45 AM, after which regular trading begins. The opening price on listing day is determined by the pre-open session demand and supply.

The listing price can be above (listing at premium) or below (listing at discount) the IPO issue price. This is determined by the actual buy/sell orders on the exchange — not by the grey market or subscription data.

What Investors Should Do at Each Stage

Being prepared at each stage helps you make faster, better-informed decisions: