What is a red herring prospectus? India IPO (2026)
A red herring prospectus, usually shortened to RHP, is the offer document a company files just before a book-built IPO opens for bidding. It lays out the business, the financials, the risks, the price band, the issue size, and the bidding dates so investors can decide whether to apply. It is the near-final version of the offer document, filed with the Registrar of Companies under SEBI's ICDR rules and the Companies Act. This page explains what a red herring prospectus is, and it is not investment advice.
Definition
A red herring prospectus (RHP)
is the offer document a company files with the Registrar of Companies before a book-built public issue opens. It discloses the business, financials, risks, price band, issue size, and bidding dates. In a book-built issue the final price is set during bidding, so the RHP carries a price band. Source: SEBI ICDR Regulations and the Companies Act, 2013.
What is in a red herring prospectus?
The RHP is meant to give an applicant everything they need except the single final price. It carries:
- A description of the business and the industry it operates in
- Audited and updated financial statements
- The objects of the issue, meaning how the money raised will be used
- Risk factors specific to the company and the offer
- The price band, issue size, and the bidding open and close dates
- Details of promoters, the promoter group, and existing shareholding
Because the offer is book-built, the exact issue price is discovered from investor bids during the window, which is why the document quotes a band rather than a fixed number. That open pricing detail is where the "red herring" name comes from.
Price band, not a fixed price
What a red herring prospectus carries for a book-built issue, with the final price set during bidding
Source: SEBI ICDR Regulations
How the RHP fits the IPO timeline
The RHP is not the first document a company files. The sequence runs like this:
- The company files a draft version with SEBI for review.
- SEBI issues its observations, and the company incorporates the changes.
- The company files the red herring prospectus with the Registrar of Companies shortly before the issue opens.
- After bidding closes and the price is discovered, the company files the final prospectus with the discovered price.
Because it is filed with the Registrar of Companies and aimed at real investors, the RHP is a binding offer document, and misstatements in it carry liability.
The draft that comes before the RHP is the DRHP, and the two are compared directly in RHP vs DRHP. For reading either document in practice, see how to read a DRHP, and for the large investors who commit ahead of a book-built issue, see what an anchor investor is.
Flock reads offer documents and regulatory filings, keeps each one dated, and links back to its source. What any of it means for you is your call to make.
Frequently asked questions
What is a red herring prospectus?
A red herring prospectus, or RHP, is the offer document a company files with the Registrar of Companies before a book-built public issue opens. It discloses the business, financials, risks, price band, issue size, and bidding dates. It is the near-final document investors read before applying. Source: SEBI ICDR Regulations and the Companies Act, 2013.
Why is it called a red herring prospectus?
The name comes from the fact that, in a book-built issue, the final issue price is discovered during bidding, so the document carries a price band rather than a single fixed price. The label signals that some pricing detail is still open. Source: SEBI ICDR Regulations.
When is a red herring prospectus filed?
It is filed with the Registrar of Companies shortly before the issue opens, typically a few days ahead, after SEBI has issued its observations on the earlier draft. The final prospectus with the discovered price is filed after bidding closes. Source: SEBI ICDR Regulations.
Is a red herring prospectus legally binding?
Yes. Unlike the draft version, the RHP is a formal offer document filed with the Registrar of Companies, so misstatements or omissions in it carry liability. It is meant for the actual investors who apply to the issue. Source: Companies Act, 2013.
Flock tracks these filings, sourced, dated, and linked back to the original. See what smart-money entities disclosed, without the guesswork about what it means.
Disclosures shown are public regulatory filings. Data may be delayed or incomplete. Smart-money entities may no longer hold positions shown. Not investment advice.