What It Means
IPO subscription is how many times an issue's bids exceed the shares actually on offer, in a given category. If a category offering 10,00,000 shares receives bids for 45,00,000 shares, it's "subscribed 4.5 times."
Example
Retail, QIB, and HNI categories are subscribed separately, and the numbers often diverge sharply. An IPO can be subscribed 2 times in retail but 15 times in QIB, which tells you institutions are far more confident than individual investors, or the reverse. Checking subscription by category, not just the single headline number, is one of the more useful things to look at instead of leaning on GMP alone.
Related Terms
- QIB (Qualified Institutional Buyer): one of the categories subscription is measured in
- GMP (Grey Market Premium): subscription numbers are one of the biggest factors that move it
- What Is GMP in IPO? Should You Trust Grey Market Premium?: where subscription is covered as a smarter check than GMP alone