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What is Subject to Sauda?

An unofficial grey market agreement where the buyer pays a fixed amount for an entire application, only if the application receives an allotment.

'Subject to Sauda' is a specific type of trade in the unregulated IPO grey market. In this arrangement, a buyer agrees to pay a fixed, predetermined amount to the applicant for an entire IPO application—but the trade is strictly conditional on the applicant actually getting an allotment.

How it works

If you apply for 1 lot (e.g., 100 shares at ₹15,000), a grey market dealer might offer you ₹3,000 "Subject to Sauda".

  • If you get the allotment, you transfer the shares (or the profit from selling them on listing day) to the buyer, and you keep the fixed ₹3,000 premium, regardless of what the actual listing price is.
  • If you do not get the allotment, the trade is voided and no money changes hands.

This allows applicants to lock in a guaranteed, fixed profit on their allotted shares and transfer the listing day price risk to the buyer.