HNI

HNI (High Net-Worth Individual) in the context of Indian IPOs refers to investors who apply for shares worth more than ₹2,00,000. SEBI formally calls this the Non-Institutional Investor (NII) category, but the market universally uses the term HNI.

In every IPO on the NSE and BSE, SEBI mandates that the issue be split into three main categories: Retail Individual Investors (RII) who apply for up to ₹2 lakh, Non-Institutional Investors (HNI/NII) who apply for above ₹2 lakh, and Qualified Institutional Buyers (QIBs) such as mutual funds and insurance companies. The NII category typically receives 15% of the total issue size.

The HNI category is further subdivided: small HNI (sHNI) applies for ₹2–10 lakh, while big HNI (bHNI) applies for above ₹10 lakh. In heavily Oversubscriptioned IPOs, the allotment method differs — sHNI allotment is lottery-based (like retail), while bHNI allotment is proportional.

For example, if an IPO is subscribed 50x in the HNI category and you apply for ₹5,00,000 as an sHNI, you are entered into a draw where each winning applicant gets the minimum lot. A bHNI applying ₹50,00,000 in the same IPO would receive shares proportional to their application amount relative to total bHNI demand.

HNI applications require full upfront payment or equivalent margin blocked via ASBA (Application Supported by Blocked Amount). The funds remain blocked in your bank account until allotment, and unblocked within 4–5 days if you do not receive shares.