PAN Card: Mandatory for Initial Public Offerings?

IPOs have become a stock market trend. There are more than 4000 companies listed in the Indian stock market. But, we need to understand the requirements to register for a stock market IPO. PAN Card or Permanent Account Number Card is an important tool for tax payments and financial transactions. So, let’s look at the importance of a PAN Card in an IPO. 

What is an IPO?

An IPO or an Initial Public Offering is a process through which privately held companies enter the public domain. They offer their shares to the public and collect funds through that. Additionally, there can be several reasons for an IPO, like expansion, repaying debt, or getting public awareness. 

As lucrative as it sounds, IPOs can also be very risky. A company has to pay a large amount to investment banks. They have to abide by several rules of SEBI and expose themselves to the market and its investors. 

What is a PAN Card?

There are various identity cards in India. One of these cards is a PAN Card or a Permanent Account Number Card. The income tax department of India issues this card.

Further, the card has your photograph, signature, date of birth, and a unique ten-digit alphanumeric code. It is used as an identification for all the taxpayers of the country. It is also used for various financial transactions and to fill income tax returns. 

Importance of PAN Card in an IPO

According to SEBI regulations 2006, possessing a PAN Card has become very important. SEBI uses this card as identification of the bidder for the IPO. So, if you skip this step or fill out the wrong PAN Card number, your application will be rejected. 

Earlier, this wasn’t the case. You could apply for IPOs without having a PAN Card. But now, a PAN card is a requirement to apply for an IPO.

Process of Application for a PAN Card

A PAN Card application is effortless. You can visit the Income Tax Department’s official website and apply for a PAN Card. You’d require documents for the application, including proof of identity and address like birth certificate, driving license, etc. Along with that, you would also need your recent passport-sized photograph. 


PAN Card is essential for investment in IPOs. One can use the Income tax department’s official website to issue a new PAN card.  

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