How to Analyse an IPO: DRHP, RHP, GMP & Subscription Guide
A practical, step-by-step guide for Indian investors: what to read in the DRHP, RHP and prospectus, the twelve factors that separate a strong issue from a weak one, and how to read GMP and subscription data without getting carried away by them.
Start with the offer documents: DRHP, RHP and prospectus
Every IPO in India moves through three filings. They contain the same core sections — business, risk factors, financials, objects of the offer — but each one is more final than the last. Knowing which one you are reading tells you how much can still change.
Draft Red Herring Prospectus
Filed with SEBI for its observations. No price band or dates yet, and details can change.
Use it to get an early view of the business, risks and who is selling.
Red Herring Prospectus
Filed with the Registrar of Companies after SEBI's observations, before the issue opens. Carries updated financials and issue dates; the price band follows by announcement.
Use it to make your final decision.
Final prospectus
Filed after the issue closes. States the final issue price and the number of shares offered.
Use it to confirm final price and issue size for your records.
Offer documents for current IPOs
Status, dates and offer documents for open, upcoming and recently closed IPOs.
What to look for before investing in an IPO: A 12-step guide
Work through these in order. Each point tells you what to look for and which section of the RHP holds the answer.
Business and industry:
What does the company sell, to whom, and how fast is its industry growing? Watch for dependence on a few customers, suppliers or regions. In the RHP: Our Business · Industry Overview.Financial track record:
The three-year trend in revenue, EBITDA and profit. Steady growth counts for more than one strong year just before listing. In the RHP: Restated Financial Information.Margins and return ratios:
EBITDA margin, PAT margin, RoE and RoCE against listed peers. Revenue rising while margins fall is a warning sign. In the RHP: Basis for Offer Price · KPIs.Cash flow and debt:
Does operating cash flow keep pace with reported profit? Check total borrowings and whether IPO money repays them. In the RHP: Restated Financials · Financial Indebtedness.Valuation:
Work out P/E, EV/EBITDA or price-to-sales at the upper price band on post-issue shares, then compare with listed peers. In the RHP: Basis for Offer Price.Fresh issue vs offer for sale:
Fresh-issue money goes to the company. OFS money goes to selling shareholders. A large OFS means existing owners are cashing out. In the RHP: The Offer · Capital Structure.Objects of the issue:
Capacity expansion and growth capex are stronger uses of funds than a large slice for general corporate purposes. In the RHP: Objects of the Offer.Promoters and management:
Track record, related-party transactions, and promoter holding before and after the issue. In the RHP: Our Promoters · Our Management.- Read the first ten risks closely — issuers tend to list the most material ones first. In the RHP: Risk Factors.
Pick an IPO and run it through the framework.
See these factors in live IPOs: analysis from Market Pulse
We publish short, sourced notes on what stands out in every DRHP and RHP — customer concentration, use of proceeds, debt, promoter holdings and more.
The Company: 14 holders own 85.96% before its IPO
The Company enters its IPO with 14 shareholders holding 85.96% of equity capital, including a 48.18% promoter and promoter-group bloc.
SFC Environmental Technologies Limited replaced three directors
SFC Environmental Technologies replaced three of four independent directors across August 13 and 14, 2026, while maintaining an eight-member board with four independent directors.
India’s tertiary wastewater-treatment market grows to Rs 7,013 crore
India’s tertiary wastewater-treatment market is projected to grow from Rs 1,870 crore in FY2026 to Rs 7,013 crore by FY2031.
SFC foreign accounts relied on management certification
SFC consolidated three foreign subsidiaries on management-certified unaudited accounts, which recorded Rs 39.031 crore FY26 revenue, nearly double Rs 20.070 crore in FY25.
Solid Waste Management Rules, 2026 Mandate Four-Way Segregation
The 2026 Rules introduce four-way segregation and online tracking, while specified industrial users must raise refuse-derived fuel substitution from 5% to 15%.
Company's Rs 253.102 crore debt has broad lender controls
Company reported Rs 253.102 crore of consolidated borrowings on July 31, 2026, with lender claims over group assets and controls over ownership changes.
Read the market signals — GMP and subscription status
Once you have a view on the fundamentals, market data tells you how others see the issue. Use it to confirm or question your view, not to replace it.
Grey market premium (GMP)
UnofficialGMP is the unofficial premium traders quote on IPO shares before they list. It reflects short-term sentiment and expected listing demand.
- It is unregulated and not published by exchanges or SEBI.
- It can swing sharply in a single day, especially near listing.
- A high GMP says nothing about long-term value.
Subscription status
Exchange dataSubscription shows how many times each investor category has bid for the shares reserved for it, updated through the bidding window.
- QIB — institutional demand; the most-watched signal of conviction.
- NII — high-net-worth bids, often leveraged; can be volatile.
- — heavy oversubscription lowers your allotment odds.
Your checklist before you apply
Six checks that can take an hour with the offer documents open or a few minutes with Iris.
- Read the Risk Factors and Objects of the Offer in the RHP, or ask Iris to summarise them.
- Compare the valuation at the upper price band with two or three listed peers.
- Check the fresh issue vs OFS split and the promoters' holding after the issue.
- Look at category-wise subscription on the final day, not only the headline number.
- Treat GMP as sentiment. Decide on fundamentals.
- Apply through ASBA or UPI before the closing-day cut-off. Mainboard retail investors can bid at the cut-off price; SME IPOs do not offer cut-off-price bidding.
Frequently Asked Questions about analysing an IPO
The DRHP is the draft filed with SEBI for review; it has no price band or issue dates and can still change. The RHP is filed with the Registrar of Companies after SEBI's observations and just before the issue opens, with updated financials and dates. Base your decision on the RHP.
Each IPO page on Multibagg links its offer document — the DRHP, RHP or final prospectus — once it is available. The documents are also published on SEBI's website and by the stock exchanges and the issue's lead managers.
Not on its own. GMP is an unofficial, unregulated number that reflects sentiment and can change quickly. It is one input among many and says nothing about the company's long-term value.
Bids exceeded the shares on offer in that category. For example, 10× retail subscription means retail bids were ten times the retail quota, so fewer applicants will receive an allotment.
Calculate P/E (or EV/EBITDA, or price-to-sales for loss-making companies) at the upper price band using post-issue shares, then compare with listed peers named in the RHP's "Basis for Offer Price" section. A premium needs faster growth or better margins to justify it.
Iris reads the DRHP or RHP for you and answers in plain English — the business model, key risks, use of funds, peer valuation — citing the section each answer comes from. It helps you analyze an issue in minutes instead of hours.
Market Pulse publishes short notes on each IPO, drawn from its DRHP and RHP — customer concentration, use of proceeds, debt, promoter holdings and key risks. Browse them all in IPO articles.
