Investing in IPOs has become one of the most popular ways for retail investors in India to earn short-term listing gains as well as long-term growth. Every time a new IPO hits the market, one phrase that quickly becomes the center of attention is “IPO GMP” or Grey Market Premium.
Whether it is the Meesho IPO GMP, Aequs IPO GMP, or any new issue coming to the market, investors rely heavily on GMP to judge the expected listing price. But what exactly is GMP? How reliable is it? Should you make investment decisions based on GMP?
This detailed blog covers everything — meaning, importance, examples, risks, and smart strategies. By the end, any investor reading this will be fully satisfied and well-informed.
What Is IPO GMP (Grey Market Premium)? — Complete Explanation
IPO GMP refers to the price at which shares of an upcoming IPO are traded in the unofficial grey market before listing on stock exchanges.
This market is called the grey market because it is not regulated by SEBI, and all transactions take place unofficially between traders and dealers.
How GMP Is Calculated
GMP = Grey Market Price – IPO Issue Price
Example:- Issue price = ₹100
- Grey market price = ₹140
GMP = ₹40
This indicates that people in the grey market expect the IPO to list at around ₹100 + ₹40 = ₹140.
Why IPO GMP Matters — What It Indicates
Although GMP is unofficial, it still plays a crucial role in IPO analysis. Here’s why:
1. Early Demand Indicator
A high GMP suggests strong demand for the IPO even before listing.
2. Expected Listing Gains
Investors use GMP to estimate potential listing day profits.
3. Sentiment Tracker
GMP reflects market mood and confidence in the company.
4. Short-Term Strategy Tool
Many investors who apply for listing gains check GMP daily to decide whether to apply.
5. Subscription Trend Predictor
Usually:
- High GMP → High subscription
- Low GMP → Weak subscription
Types of Grey Market Rates You Should Know
Understanding grey market trading types is important for clarity:
1. Grey Market Share Price
This is the estimated premium per share over the issue price.
2. Kostak Rate
The premium paid for buying an entire IPO application from someone.
3. Subject-to-Sauda Rate
The premium paid only if the IPO gets allotted — otherwise, the deal is cancelled.
These rates are all unofficial but widely used in IPO circles.
Meesho IPO GMP — Latest Detailed Insights
Meesho IPO is one of the most awaited offerings, and investors are actively tracking its GMP.
1. Meesho IPO Price Band
₹105 – ₹111 per share
2. Current Meesho IPO GMP (Approximate Range)
Market sources indicate:
- ₹35 to ₹50 per share
- Some days, GMP has touched even higher due to demand
GMP fluctuates daily based on market sentiment, subscription status, and broader market conditions.
3. Expected Listing Price Based on GMP
If GMP = ₹40
Estimated listing price:
₹111 + ₹40 = ₹151 per share
4. Why Meesho IPO Has High GMP
- Strong brand reputation in the e-commerce space
- Improving financial performance
- Rising investor confidence in digital companies
- Strong expected subscription from retail and HNI investors
- Market optimism favouring tech-driven businesses
While GMP is strong, investors should combine it with fundamental analysis.
Aequs IPO GMP — Latest Trend & Analysis
Aequs is another interesting IPO gaining traction in the grey market.
1. Aequs IPO GMP Range
Approximate market range:
- ₹35 – ₹45 per share
2. Expected Listing Price
Based on the available GMP range, the listing price is expected to be at a healthy premium over the issue price.
3. Why Aequs IPO Is Attracting Interest
- Strong presence in aerospace manufacturing
- Good order book visibility
- Sector growth outlook
- Healthy investor interest ahead of listing
Even though GMP is positive, long-term performance depends on business fundamentals.
How to Check Live IPO GMP (Daily Method)
Since GMP changes throughout the day, here’s how investors can check reliable updates:
✔ Check multiple financial portals
✔ Follow grey-market tracking websites
✔ Track subscription trends daily
✔ Join IPO discussion forums
✔ Compare GMP from 2–3 sources (never rely on only one)
This gives a more accurate idea about real demand.
Misconceptions About IPO GMP — The Truth
There are many myths surrounding GMP. Here are the most common ones:
❌ “GMP guarantees listing gains”
Truth: GMP only shows unofficial sentiment; listing may differ.
❌ “High GMP means the company is strong”
Truth: Fundamentals decide long-term value — not GMP.
❌ “Grey market trades are safe”
Truth: All grey market activities are unregulated and unofficial.
❌ “GMP remains the same until listing”
Truth: GMP can change drastically based on market conditions.
Risks of Following IPO GMP Blindly
Investors should always be aware of the risks:
1. The Grey Market Is Unregulated
There is no legal protection for any trades done outside the exchange.
2. GMP Can Be Manipulated
Dealers often inflate GMP to create hype.
3. Market Volatility Affects Listing
A good GMP can suddenly drop if the market turns negative.
4. No Guarantee of Allotment
High GMP often means extremely high demand → low allotment chances.
5. Long-Term Returns Depend on Fundamentals
Even if an IPO lists at a premium, long-term growth depends on company performance.
How to Use IPO GMP Wisely — Smart Investor Strategy
Here’s how to make the best use of GMP without taking unnecessary risk:
✔ Use GMP as a supporting indicator, not the only factor
✔ Study company fundamentals
✔ Track QIB & HNI subscription numbers
✔ Look at overall market sentiment
✔ Avoid investing due to hype or FOMO
✔ Decide based on your risk profile
Balanced decision-making ensures better control and better outcomes.\
Final Conclusion — Is IPO GMP Useful?
Yes — IPO GMP is useful, but only as a sentiment indicator.
It gives an idea about:
- Market demand
- Expected listing gains
- Investor interest
But since GMP is unofficial, unregulated, and often speculative, investors should never depend on it alone.
A smart approach is to combine:
GMP + Fundamentals + Subscription Data + Market Condition
This combination results in informed and confident investment decisions — whether it is for Meesho IPO, Aequs IPO, or any other upcoming issue.