How to Invest in US IPOs from India: What's Actually Possible

You cannot buy shares in a US IPO at the IPO price. That is the short answer. Most US IPOs allocate roughly 90% of their shares to institutional investors, such as pension funds, hedge funds, and large asset managers. Indian retail investors are not part of that allocation at all. But that does not mean you are locked out of US IPO stocks. There are two practical ways to access them, starting from the day a company begins trading. 

Can Indians Get US IPO Shares at the IPO Price?

When a company goes public in the US, you might wonder if Indians can submit an application and get shares at the IPO price, the way you would for an Indian IPO. The answer is almost certainly no, and the reason has nothing to do with LRS limits or SEBI rules. It comes down to how the US IPO process is structured from the start.

In India, IPOs are designed for retail participation. What does this mean? 

Well, when a company decides to go public, it files a Draft Red Herring Prospectus with SEBI. Once SEBI approves it, the issue opens to all eligible retail investors at the same time, through any registered broker. Applications flow into a central repository run by BSE and NSE. Your money is not debited immediately but blocked through ASBA, sitting in your own bank account until allotment is done.

SEBI also mandates that at least 35% of the issue must be reserved for retail investors. If more people apply than there are shares available, a lottery decides who gets an allotment. Every retail applicant gets an equal shot at the minimum lot, no matter which broker they use or how large their account is.

This open, rule-based system means that any Indian investor with a demat account can participate in any Indian IPO. That access is guaranteed.

Why US IPOs Work Differently from Indian IPOs

The US has no equivalent of that system. When an American company goes public,, it hires investment banks to manage the process. These banks, called underwriters, run a roadshow where they pitch the company to large institutional investors and gauge demand. For example for SpaceX, Goldman Sachs led the process, with Morgan Stanley, JPMorgan, and other banks in the syndicate. 

These banks control everything: who gets shares, how many, and at what price. There is no central repository. There is no public application window.

If you want to buy IPO shares at the offer price in the US, you need to get the shares from only select banks and underwriters involved in the IPO. The allocation of the shares is completely at the discretion of the underwriters. Institutional investors, hedge funds, and large asset managers almost always come first, especially when a deal is oversubscribed.

Can Indians Buy US IPO Shares?

In the US, IPOs aren't designed with a public retail access point the way Indian IPOs are. Historically, around 90% of US IPO shares go to institutional investors, and roughly 10% goes to US retail investors. Indian investors are not included in that retail tranche.

This applies to most platforms offering US stock investing to Indian investors, not just INDmoney. You can only participate in the retail allocation if you have access to a broker that is part of the IPO syndicate. But getting into an underwriter's syndicate for the most-anticipated deals requires specific institutional relationships that take time to establish, which is something INDmoney is working toward.

Note that not just Indian retail investors, but even US retail investors who do have access to an IPO often receive no shares, or far fewer than they requested. Popular IPOs are massively oversubscribed on the retail side, and allocations can be as small as a handful of shares per applicant.

2 Ways Indian Investors Can Access US IPO Stocks

Since direct IPO allocation is off the table, you have two other routes. Each suits a different type of investor, and the right one depends on how much capital you have, how much risk you can take, and how soon you want to get in.

Option 1: Buy on Day 1 of Listing via INDmoney

When a US company completes its IPO, its shares start trading publicly on the NYSE or NASDAQ from the next morning. For you in India, that means the stock is available to buy from 7:00 PM IST on the listing day (this shifts to 8:00 PM IST from November to March because the US observes Daylight Saving Time between April and October).

You can buy those shares through INDmoney the moment trading begins, the same way you would buy any other US stock on the platform. No special access is required. You are simply buying from the open market.

Step-by-Step: How to Buy a Newly Listed US Stock on INDmoney App

1. Open the INDmoney app and tap on the US Stocks section.
2. Search for the company using its ticker symbol. For example, SPCX for SpaceX or COIN for COINBASE. The ticker is usually announced with the IPO date.
3. Check your USD wallet balance. If you need to fund it, initiate a remittance from your linked Indian bank account via LRS. Remittances typically settle in 24 hours, so fund your wallet 2-3 days before the listing date.
4. Wait for the US market to open. That is 7:00 PM IST on listing day. Place a market order to buy at the current price, or a limit order if you want to buy only at a specific price.
5. Your shares appear in your US Stocks portfolio once the order is executed.

Why Buying Post-Listing Is Not a Disadvantage

The instinct to "get in at the IPO price" is understandable. But research on actual IPO performance does not support the idea that first-day buyers come out ahead.

Studies covering thousands of US IPOs consistently find that the majority of stocks bought at first-day closing prices lose money over a three-to-five year period compared to a market index. In one detailed analysis, 60% of IPOs bought at the first-day closing price had lost money three years later, and 57% had lost money after five years.

Part of this is mechanical. If an IPO prices at $20 and opens at $26 due to first-day hype, you are already paying 30% more than what institutional investors paid the night before. That premium comes entirely out of your potential return.

Waiting a few days or even a few weeks after listing gives you information you did not have on day one. You can see how the stock behaves when the opening pop fades, whether the company meets early expectations, and whether the initial enthusiasm holds. Many heavily hyped names pull back meaningfully within two to four weeks of listing, giving patient investors a better entry.

Option 2: Buy After Lock-Up Expiry (90–180 Days Post-Listing)

If you are a long-term investor, this is often the most practical and underused approach. It takes patience, but it usually delivers a better average cost than buying on listing day.

What is Lock-Up Expiry and Why It Creates Buying Opportunities

When a company goes public, its insiders, founders, early employees, and venture capital investors, are legally barred from selling their shares for a specified period after the IPO. This is the lock-up period, and it typically lasts 90 to 180 days from the listing date. The lock-up is not a government regulation; it is a contractual agreement between the company and its underwriters to prevent insiders from immediately cashing out and flooding the market with supply.

When the lock-up period expires, insiders can sell for the first time. The market often anticipates this. In the weeks around lock-up expiry, stocks frequently see selling pressure as investors price in the incoming supply of shares. Prices tend to dip.

That dip is usually a buying opportunity for retail investors. The pattern is not universal. If a company is performing well, insiders may not rush to sell, and the price may hold. But for companies where market sentiment has cooled since the IPO, lock-up expiry often creates a meaningful pullback that long-term investors can use.

How to Find the Lock-Up Expiry Date for Any US IPO

The lock-up period terms are disclosed in the company's S-1 filing, which is the registration document filed with the US Securities and Exchange Commission (SEC) before every IPO. Here is how to find it.

• Go to the SEC's free database at edgar.sec.gov.
• Search for the company by name using the search bar at the top.
• On the company's filing page, look for Form S-1 (or S-1/A, which is an amendment to the original S-1). These were filed before the company listed.
• Open the S-1 and search within the document for the word "lock-up" or "lock up". You will find a section that states the duration, for example, "180 days from the date of this prospectus."
• Count forward from the IPO date to calculate when the lock-up expires. If the IPO was on June 1 and the lock-up is 180 days, expiry falls around November 28.

Some financial websites also track upcoming lock-up expirations for recently listed companies, which saves you the step of reading through S-1 filings manually.

Rules Every Indian Must Know Before Buying US IPO Stocks

Before you invest in any US stock, including newly listed ones, you need to understand the regulatory and tax framework that applies to Indian residents.

The $250,000 Annual LRS Limit

Under the Reserve Bank of India's Liberalised Remittance Scheme (LRS), every resident Indian can remit up to $250,000 abroad in a financial year (April to March). This limit covers all foreign investments combined, including US stocks, foreign mutual funds, and overseas bank accounts.

TCS on Remittances Above Rs. 10 Lakh

For investment remittances (including US stocks), TCS at 20% applies on the amount exceeding Rs. 10 lakh in a financial year. The Rs. 10 lakh threshold is cumulative across all LRS purposes within the year.

When you file your ITR, you can claim this TCS against your total tax liability. If your actual tax for the year is lower than the TCS collected, the Income Tax Department refunds the difference.

Schedule FA Disclosure in ITR

If you hold US stocks at any point during a financial year, you must disclose them in Schedule FA of your Income Tax Return. This applies to every Resident and Ordinarily Resident (ROR) Indian taxpayer, regardless of the value of their holdings or whether those holdings generated any income.