What is IPO GMP (grey market premium)?

Before an IPO lists on the stock exchange, some people informally buy and sell rights to its shares in what is called the grey market. The grey market premium (GMP) is the amount above the issue price at which those informal deals are quoted.

For example, if an IPO's price band is ₹140 to ₹150 and the GMP is ₹40, the grey market is suggesting the share might trade around ₹190 (₹150 + ₹40) on listing day. A negative GMP suggests the share might list below its issue price.

The grey market is not part of the regulated stock market. It is not run or supervised by SEBI, BSE or NSE, there is no official record of its prices, and anyone dealing in it has no investor protection. Different sources often quote different GMPs for the same IPO on the same day, and a GMP can be pushed up or down by a small number of participants, especially for small SME issues.

Because of this, IPONexa shows GMP as an indicative, unofficial figure and keeps it clearly separate from official data such as the price band, subscription figures and the actual listing price.

• GMP figures come from our IPO data provider and are refreshed once a day, in the evening (Indian time). Where the provider has no GMP for an IPO, a figure may be entered manually from another public GMP website; it is marked “entered manually” and names that website. Each figure shows the date it was quoted.
• A GMP quoted more than 48 hours ago is marked Outdated, so an old number is never presented as current.
• If no GMP has been reported, we show “No GMP reported” instead of ₹0. A missing GMP does not mean the market expects a flat listing.
• Once an IPO lists, we stop showing GMP and show the actual listing price and gain from the stock exchanges instead.

The estimates on IPONexa use simple arithmetic on the latest GMP:

• Estimated listing price = issue price + GMP. Until the final issue price is announced, we use the upper end of the price band, because that is the price most IPOs are finally priced at and the price retail investors usually bid at (the “cut-off” price).
• GMP % = GMP ÷ that price × 100.
• Estimated gain per lot = GMP × number of shares in one lot.

Example with made-up numbers: price band ₹140–₹150, GMP ₹40, lot of 100 shares. Estimated listing price ₹190, GMP % 26.67%, estimated gain per lot ₹4,000. These are indicative figures only; see how listing gains are calculated for why your actual result can be very different.

• Treat GMP as market gossip with a number attached, not as a forecast.
• Compare it with official information: the company's financials and risks in the offer document (RHP), the price band, and the official subscription figures published by the exchanges.
• Look at how past IPOs actually listed. The recently listed IPOs page shows real listing-day results.
• Do not deal in the grey market itself; trades there are informal and unprotected.