Trading in IPO shares in grey market is conducted between two parties – buyer and seller.
The buyer is a person who believes that the IPO will be profitable with expected listing price above the issue price and is therefore interested in buying IPO shares.
The seller is a person who has already applied for the IPO but has doubts as to whether the IPO can be listed at a loss or whether an allotment is not possible, and therefore wishes to sell his IPO shares or applications before the shares are allotted.