What is a DRHP? The first step to an IPO in India
By Abha Lohia · Startup Decoded
A DRHP, or draft red herring prospectus, is the document a company files with SEBI, India's markets regulator, when it plans to list its shares through an IPO.
What is inside
The DRHP describes the business, its finances for recent years, the risks, the people running it, who owns how much, how much money the IPO will raise and what it will be spent on. It also says which shareholders plan to sell shares (the offer for sale) and how many new shares will be issued (the fresh issue). It does not yet carry the share price.
What happens next
SEBI reviews the draft and sends its observations. The company then files an updated document, the red herring prospectus (RHP), with the price band added, and opens the IPO for bids. The DRHP is usually public, so investors and journalists can read it months before the listing.
The confidential route
Since 2022, SEBI also allows companies to pre-file the draft confidentially, so the details stay private until later in the process. Several Indian startups have used this route before going public.
Questions people ask
Does filing a DRHP mean the IPO will happen?
No. Companies can delay or drop an IPO after filing, for example if markets fall.
What is the difference between a DRHP and an RHP?
The DRHP is the draft for SEBI's review; the RHP is the updated version filed before the IPO opens, with the price band.
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