IPO FPO follow-on public offer SEBI ICDR zerodha ASBA UPI

Follow-on public offer (FPO) on Zerodha

From WebNotes, a public knowledge base. Last updated 21 June 2026. Reading time ~12 min.

Key facts

What it is	A further sale of shares to the public by a company that is already listed, governed by SEBI (ICDR) Regulations 2018
Two types	Dilutive (fresh shares, money goes to the company) and offer for sale (promoter shares, money goes to the seller)
Governing regulation	SEBI (ICDR) Regulations 2018, with the fast-track route under Regulation 155
How you apply on Zerodha	The same UPI ASBA flow as an IPO, under Orders, then IPO, on Kite; funds come from your bank, not your Kite balance
UPI application ceiling	Rs 5 lakh per application; above that, use bank net-banking ASBA
Investor categories	Qualified institutional buyer (QIB), non-institutional investor (NII), and retail individual investor (RII), with proportionate allotment within each

A follow-on public offer (FPO) is a sale of shares to the public by a company that is already listed on a stock exchange, made under the SEBI (ICDR) Regulations 2018 , with the Securities and Exchange Board of India as the regulator. It is the post-listing cousin of the initial public offer : same book-built or fixed-price machinery, same ASBA plumbing, same three investor categories, but run by an issuer that already has a market price, a shareholder register, and continuing disclosures under the LODR Regulations 2015 . Through Zerodha , you apply for an FPO on Kite using the same UPI ASBA flow as an IPO.

The single fact that decides what an FPO means for you is whether it is dilutive or an offer for sale. A dilutive FPO creates fresh shares; the money raised goes to the company and the share count rises, so each existing share owns a thinner slice unless earnings climb to match. An offer-for-sale FPO sells shares that already exist, held by promoters or early investors; no new shares are minted, the company receives nothing, and the seller pockets the proceeds. The Adani Enterprises FPO of January 2023, a Rs 20,000 crore book-built dilutive offer that the company withdrew and refunded after the issue had closed, remains the reference case Zerodha itself uses when explaining the Kite FPO flow.

This article covers what an FPO is and how it differs from an IPO and a rights issue , the dilutive-versus-OFS distinction in detail, the SEBI ICDR framework including the fast-track route, the investor categories and allotment, and the exact Kite application steps with the one constraint that trips people up: FPO money comes from your bank, never from your Kite trading balance.

What a follow-on public offer is

Definition

An FPO is a further issue of specified securities to the public by an issuer whose shares are already listed and traded. The issuer files an offer document with SEBI and the Registrar of Companies , prices the offer through book building within a price band or at a fixed price, and allots through the same exchange bidding and ASBA infrastructure that an IPO uses. Because the company is already listed, the FPO price is anchored to a visible market price rather than discovered from scratch, which is the central difference from an IPO in pricing terms.

FPO versus IPO

Dimension	IPO	FPO
Issuer status	Unlisted, listing through the offer	Already listed and traded
Price reference	Discovered through book building, no prior market price	Anchored to the live market price
Document	Draft Red Herring Prospectus, then RHP	Offer document; fast-track route skips the draft filing
Investor categories	QIB, NII, RII (and others)	QIB, NII, RII (and others)
Application route	UPI ASBA or net-banking ASBA	UPI ASBA or net-banking ASBA, identical
Typical use	Raise primary capital and create a public float	Raise more capital, or let large holders sell down

For the retail applicant, the application experience is the same: same Orders, then IPO path on Kite, same UPI mandate, same cut-off price option. The differences sit upstream in how the issuer qualifies and prices the offer.

FPO versus rights issue

A rights issue and a dilutive FPO both raise fresh capital and both dilute non-participants, but a rights issue offers the new shares only to existing shareholders in proportion to their holding, at a fixed discount, with a rights entitlement you can sell if you choose not to subscribe. An FPO offers shares to the whole public through competitive bidding. A company that wants to keep its existing shareholder base topped up uses a rights issue; one that wants to broaden the register or place a large block uses an FPO.

Dilutive FPO versus offer for sale

This is the distinction that determines whether your existing holding is diluted and where the money goes.

Dilutive FPO

In a dilutive FPO the company issues new shares. The total share count rises, the proceeds flow to the company’s balance sheet, and the funds are used for growth capital, debt reduction, or acquisitions. Existing shareholders who do not subscribe see their ownership percentage fall and their earnings per share diluted unless the company’s profits rise in step with the larger share base. Most FPOs that aim to raise primary capital are dilutive.

Offer for sale FPO

In a non-dilutive FPO, existing shareholders, usually promoters or early institutional investors, sell part of their holding to the public through the offer-for-sale mechanism. No new shares are created, the total outstanding share count is unchanged, and there is no dilution of existing per-share metrics. The proceeds go to the selling shareholders, not to the company. This route is often used to meet minimum public shareholding requirements or to let an early investor exit at scale. The standalone exchange offer-for-sale window is a related but distinct mechanism aimed at a faster, exchange-based sell-down; an OFS bundled inside an FPO document follows the FPO timetable and disclosure.

A single FPO can mix the two: part fresh issue, part offer for sale. Read the offer document’s “objects of the issue” and the breakup of fresh issue versus offer for sale to know how much of your money reaches the company and how much pays out a selling shareholder.

SEBI regulatory framework

ICDR Regulations 2018

FPOs are governed by the SEBI (ICDR) Regulations 2018 , the same regulation that governs IPOs and rights issues, with FPO-specific provisions for an already-listed issuer.

Eligibility, Regulation 6: an issuer making a public issue must meet conditions including a track record of net tangible assets and operating profit, or qualify through the alternative profitability and net-worth tests in the regulation. A listed issuer typically clears these more readily than a first-time IPO applicant.
Promoter contribution: promoters contribute a minimum share of the post-issue capital or issue size, locked in for the prescribed period, with the exact requirement turning on the FPO structure.
Pricing: a book-built FPO prices within a price band; the upper end of a price band cannot exceed 120 per cent of the floor price, and the offer is anchored to the prevailing market price.

Fast-track route, Regulation 155

Regulation 155 of the ICDR Regulations provides a fast-track route for a further public offer. An eligible listed issuer that meets the conditions, which include a minimum market capitalisation of public shareholding, a continuous listing record, and a clean compliance history, does not file a draft offer document with SEBI for observations. It announces the price or floor price or price band through a pre-offer newspaper advertisement at least one working day before the offer opens. The fast-track route is why a well-established listed company can run an FPO far faster than a first-time IPO.

Subscription period and disclosure

A book-built FPO stays open for 3 to 10 working days for bidding. The offer document, filed with SEBI and the exchanges, is the principal disclosure, and it incorporates the issuer’s existing LODR filings by reference, which is why FPO documents are often thinner than a first-time RHP.

Investor categories and allotment

An FPO is offered to the same categories as an IPO, with reservation and allotment rules set in the offer document.

Qualified institutional buyers (QIBs): institutional applicants, including a sub-reservation for anchor investors who commit a day before the offer opens. See anchor investor .
Non-institutional investors (NIIs): applications above the retail ceiling, including HNIs, HUFs, NRIs, and corporate bodies.
Retail individual investors (RIIs): individual applications up to the retail limit, the category most Zerodha clients fall in.

All allottees other than anchor investors and, in an oversubscribed retail category, the minimum-lot draw of lots, are allotted on a proportionate basis within their category. The basis of allotment and any oversubscription follow the same SEBI rules as an IPO.

How to apply for an FPO on Zerodha Kite

The Kite FPO flow is the same as the IPO flow , under Orders, then IPO. The list of UPI apps and banks that support FPO applications is published by NPCI; check the live partners list before you start if you are unsure your bank handle is supported.

On Kite, click Orders, then IPO, then Apply, and select your investor type.
Enter the UPI ID mapped to your own bank account, then enter the quantity and price, or tick the cut-off price . You can place up to three bids.
Accept the undertaking and click Submit, then approve the mandate request on your UPI app.
The exchange sends an SMS confirming the bid at end of day, and Zerodha emails a confirmation of the application.

You can apply through UPI ASBA only as an individual investor with an application value below Rs 5 lakh. You can accept the UPI mandate up to 5 PM on the FPO closing day.

The Kite-balance constraint

You cannot apply for an FPO using funds sitting in your Kite trading account. SEBI permits public-issue applications only through ASBA, where the application money stays blocked in your bank account through UPI or net banking until allotment. If your money is in your Zerodha trading balance, withdraw it to your bank account first, then apply. If you do not receive an allotment, the blocked amount is unblocked in your bank account.

Applying without UPI, net-banking ASBA

If you have no UPI ID, or your application exceeds the Rs 5 lakh UPI ceiling, use your bank’s net-banking ASBA service. Log in to your internet banking portal, find the IPO or rights or public-issue section, and enter your Zerodha demat details: your 16-digit demat ID from console.zerodha.com, depository CDSL , and DP name Zerodha. The bank blocks the amount and debits it only on allotment. Non-individual accounts, including company, partnership, LLP, AOP, trust, and society accounts, can apply only through ASBA, not UPI. HUFs can use UPI ASBA by mapping the HUF bank account to the UPI ID. Minor accounts can apply online through UPI or ASBA.

What can go wrong

Trying to pay from your Kite balance: FPO money must come from your bank through ASBA. Withdraw any Kite trading funds to your bank before applying, or the application cannot be funded.
Crossing the Rs 5 lakh UPI ceiling: an individual application above Rs 5 lakh cannot go through UPI. Switch to net-banking ASBA for the larger amount.
Using someone else’s UPI ID: the UPI ID must be mapped to your own bank account, or the application is rejected.
Mistaking an OFS FPO for a fresh issue: read the objects of the issue. In an offer-for-sale FPO your money pays a selling shareholder and the company receives nothing.
NII applications cannot be reduced: an application under the NII or HNI category cannot be deleted or reduced in size after submission; it can only be revised upward.

External references

References

SEBI (Issue of Capital and Disclosure Requirements) Regulations 2018, including Regulation 6 (eligibility) and Regulation 155 (fast-track further public offer), sebi.gov.in.
SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, continuing disclosures referenced in fast-track FPO documents.
SEBI General Information Document for Investing in Public Issues, ASBA and UPI application framework.
NPCI, UPI in IPO and FPO live partners list and the Rs 5 lakh per-application UPI limit.
Zerodha support, applying for an FPO on Kite (Adani Enterprises FPO reference flow) and the ASBA-only funding requirement.

Frequently asked questions

What is the difference between an FPO and an IPO?

An IPO is a company’s first sale of shares to the public, after which it lists. An FPO is a further public sale by a company that is already listed. The Kite application flow is the same UPI ASBA process for both.

Is an FPO good or bad for existing shareholders?

A dilutive FPO issues fresh shares, so each existing share owns a smaller slice of the company unless earnings rise to match. An offer-for-sale FPO creates no new shares, so it does not dilute holdings; only the seller’s stake changes hands.

Can I apply for an FPO using my Zerodha trading balance?

No. SEBI permits FPO applications only through ASBA via UPI or bank net banking, where the money stays blocked in your bank account. Funds sitting in your Kite trading account cannot be used; withdraw them to your bank first.

What is the UPI limit for an FPO application?

An individual investor can apply through UPI ASBA only up to Rs 5 lakh per application. Above Rs 5 lakh, the application must go through a Self Certified Syndicate Bank using net-banking ASBA.

How do I apply for an FPO on Kite?

On Kite, go to Orders, then IPO, then Apply, pick your investor type, enter your UPI ID and bid quantity and price or cut-off, submit, and approve the mandate on your UPI app by 5 PM on the closing day.

Are FPOs governed by the same rules as IPOs?

Both fall under the SEBI (ICDR) Regulations 2018. An FPO by an eligible listed company can use the fast-track route under Regulation 155, which skips the draft-document filing that an IPO requires.

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WebNotes Editorial Team

The WebNotes Editorial Team covers Indian capital markets, payments infrastructure and retail investor procedures. Every article is fact-checked against primary sources, principally SEBI circulars and master directions, NPCI specifications and the official support documentation published by the intermediary in question. Drafts go through a second-pair-of-eyes review and a separate compliance read before publication, and revisions are tracked against the SEBI and NPCI rule changes referenced in the methodology section.

Last reviewed: 21 June 2026
Conflicts of interest: WebNotes is independent. No relationship with any broker, registrar or bank named in this article.