Does IPO get allocated to people who apply first?
Short Answer
No, IPO allotment doesn't work like that. It is not dependent on who applied first, rather it is based on the total issue demand. There isn't a formula but a set process based on which the shares get allotted to different category of applicants.
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Detailed Answer
No, IPO doesn't get allocated based on a first-come, first-serve basis. The allotment of shares in case of an IPO depends on the interest of the potential investors. If a lot of investors show interest in any particular IPO, then the allocation of shares to the retail investors is done through a lottery.
On the other hand, if there is less interest among investors to buy an IPO, then one can get all the shares applied for. If the demand is high, then the allocation of shares among retail investors done by dividing the total number of shares available in the retail quota divided by the minimum lot size.
