New SME IPO July Norms: Retail Investors Must Now Bid for Minimum Two Lots

India's leading stock exchanges, NSE and BSE, have announced major changes in the bidding process for SME IPOs, starting from July 1, 2025. These changes aim to enhance transparency, efficiency as well as investor protection.

One of the major changes that have been made is that retail investors must now bid in two lots.

What Is Changing?

Individual Investor: What was earlier known as a retail investor will now be called individual investor as the category 'Retail Individual Investor' has been renamed 'Individual Investor'. An individual investor can now apply for a minimum of 2 lots (worth more than Rs 2 lakh). This is a substantial increase as compared to the previous limit, which was more favourable for small investors.

Minimum Bid Size Increased: Qualified Institutional Investors (QIBs) and Non-Institutional Investors (NIIs) are also required to apply for more than 2 lots. For employees, shareholders as well as policyholders, the minimum application size is 2 lots (over Rs 2 lakh), with a maximum limit of up to Rs 5 lakh.

Cut-Off Price Option Removed: Since the cut-off price option has been removed, investors will now have to place bids at a specified price, as the 'cut-off price' option has been removed entirely.

No Modification Or Cancellation Of Bids: If a bid is placed, it cannot be withdrawn or reduced. This rule aims to discourage speculative or impulsive bidding behaviour.

Final Day Deadline: For all categories, the bidding window will close at 4:00 pm on the last day, and UPI mandate approval must be completed by 5:00 pm on the same day.

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