In just three months, over one lakh retail investors bought unlisted NSE shares, according to Economic Times. Many retail investors now want to buy shares of well-known companies before they list on the stock exchange, hoping to benefit from a potential IPO listing gain.
Unlisted shares are stocks of companies that are not yet listed on the stock exchange. Popular names in the unlisted market include NSE, Chennai Super Kings, OYO and PharmEasy. These shares are traded through brokers, dealers or online unlisted share platforms.
You can buy unlisted shares in two main ways, either through intermediaries and brokers who deal in unlisted shares or through employees or promoters who sell their holdings before an IPO. It’s important to check if the seller is genuine and the deal is transparent.
Unlisted shares don’t have a fixed market price like listed stocks. Their price is based on demand, supply and the company’s performance outlook. Settlement happens through off-market transfers to your demat account once you pay the agreed price to the seller.
Unlisted shares can be risky because there is no easy exit before the IPO. Prices can fluctuate sharply as they are not regulated by an exchange daily. Also, there is no guarantee of a profitable IPO or listing timeline. Investors should be aware of the lock-in period and tax rules before investing.
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