Kostak, otherwise called the “price of application”, is a premium amount that catalyses the process of trading in Grey Market. Therefore, it can be inferred that one can sell an IPO application before listing at the allotted time. This facility is for those who don’t want any risk with IPO allotment or listing profits.
Grey Market is an unofficial market and applies when a suspended stock or new securities are sold before an official trade/listing is applied. This market segment lets the issuer measure the need for newer pricing as it gains offering in the future or an illegal trading operation.
Grey Market IPO, here is an unofficial market where people buy and sell in IPO Share Market before the launching date over the stock exchange. However, trading in the Grey Market is illegal and not recognized by regulatory bodies such as the Securities and Exchange Board of India (SEBI)
The whole market operation involves a smaller number of people group; there isn’t any official Online Trading Platform, except the terms like Kostak and Grey Market Premium (GMP)
What Is Kostak in IPO?
As discussed above, In any IPO Grey Market, the Kostak rate is an amount payable for IPO application before the share gets Trade in Stock. This is where the concept of Grey Market is dug deep before listing, and there is a fluctuation in the GMP. So, when kostak is inlined with GMP, it brings much profit as the market reacts to bracket rates.
So, with several issue prices set per share to be listed somewhere shortly, if one doesn’t want to wait till the listing date and instead think of trading, one would find a way to buy/sell shares unofficially.
For buyers willing to take the risk, and with consent from a seller, one can make the deal and exit from the transaction. The amount dealt here to exit is the Kostak, which complies with settling the difference.
Latest IPO GMP & Kostak Rates (use latest)
IPO GMP rates get updated every now and then, so there is no such exact rate. Therefore, you need to do much analysis and research, finding tidbits to ensure smoother transactions.
It is good to place the bid wisely and be sourced from market intelligence. However, as the future rates are volatile, you should look forward to different dates, markets, and geographies to ensure accuracy.
How Are Kostak Rates Related to IPO GMP?
Kostal rate, alongside Sauda forms, serves as the backbone of GMP, liable to tax remains sold with the seller under the application incurring. So even if there seems to be a profit coming, when the taxes are replenished, it is evident that you might go through some loss based on calculating the actual amount.
As explained, the ideas on IPO applications can help make wise decisions. Make your profit with Kostak premium amount without any risk with IPO allotment or listing profits. Check the Shoonya App section on IPO News and SEBI approval status, gaining information on best practices led by the primary marketplace. Shoonya is the Best Online Trading Platform in India. So check us, or write to us, and we will make more for you.