Grey Market & Listing8 min read25 June 2026

The Truth About Grey Market Premium (GMP): How Kostak & Sauda Rates Work in India

Understand the mechanics of unofficial grey markets. Learn what Kostak rate, Subject to Sauda, and live GMP indicate, along with the regulatory warnings and operational limitations.

Team IPO Listing

Lead Research Desk

The Truth About Grey Market Premium (GMP): How Kostak & Sauda Rates Work in India

Grey Market & Listing Masterclass

1. Demystifying the Grey Market

The IPO Grey Market is an informal, unofficial dealer network where application forms and prospective shares trade prior to exchange listing.

2. Key Terms Defined

Grey Market Premium (GMP): The premium amount buyers are willing to pay per share above the official issue cap price.

Kostak Rate: Fixed profit paid for an IPO application before allotment results, regardless of whether shares are allotted.

Subject to Sauda: Contract where seller receives a predetermined payment only if an allotment is successful.

Apply This Research With Live IPO Tools

Put these investment strategies into practice using our zero-storage calculators and live market trackers:

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