Unfortunately, no. The Securities and Exchange Board of India has made it mandatory for an investor to have a demat account if he wishes to invest in the stock market. Without a demat account, you neither apply for an IPO, nor buy or sell shares in the stock exchange.

That said, while a demat account is mandatory to invest in an IPO, a trading account with a stockbroker is not. This effectively means that you can invest in an IPO even without opening a trading account with a stockbroker through a process called Application Supported by Blocked Amount (ASBA). All that you need to apply for an IPO through this process is a bank account that supports ASBA and requisite funds for investing in the IPO.

Let’s take a quick look at the process flow that you would need to follow for applying for an IPO through the ASBA process. Here’s a word of caution. This process flow is merely representative and may change slightly depending on your bank.

  • Firstly, log into your bank’s internet banking portal using your user ID and password.
  • Search for the ‘IPO’ tab and click on it. You can typically find this option under the ‘Investments’ or ‘Demat’ tab in your internet banking portal.
  • The portal will most probably redirect you to a dedicated IPO section.
  • Once you’re there, click on the IPO that you wish to invest in and enter all the relevant details such as the number of shares and the price of your choice.
  • Enter the details of your demat account such as the depository in which you hold the account, your name as specified in your demat account, and the account number.
  • Upon entering all the relevant details, click on submit.
  • As soon as you submit your application, the requisite amount gets blocked in your bank account and becomes temporarily unusable. Also, you can view the application you submitted through the IPO order book option.

Here’s another word of caution. If you get the shares allotted to you, you might not be able to sell them in the stock market without a trading account. And so, while you can invest in an IPO without a trading account, it is a good idea to have one by your side.