BASIS OT ALLOTMENT RETAIL INVESTORS :
EXAMPLE CASE = limit 1 lac minimum lot 100 shares price range 55 to 60 scrip XYZ
1 ) FIRM ALLOTMENT : when the issue is FULLY / PARTLY SUBSCRIBED firm allotment is made for no. of shares as applied by you .
2 )PROPORTONATE ALLOTMENT : when a issue is OVERSUBSCRIBED proportionate allotment is made .
A) if issue oversubscribed 6.5 times in retail then divide your application quantity by 6.5 and shares will be alloted in multiple of 1 share above minimum lot i.e. 108,123,and so on. however persons applying between 100 to 600 shares if they divide by 6.5 then the shares will work out less than 100 ,since minimum allotment has to be 100 shares instead of rejecting these applications ,applicants between 100 to 600 shares will be allotted 100 shares by lottery whether u have applied 100 or 600 shares . ofcourse probability for success in lottery will be better for those applying 600 shares over those applying 100 shares.
B) issue oversubscribed more then retail limit say above 17 times in this case then one will get allocation of minimum lot of 100 shares alloted by lottery whether have applied for 100 shares or full 1600 shares with different probability chances i.e. 1600 application will have better chance over 100 share application in lottery.
Hope u will find this informative,and will understand the allotment procedure , You can also view basis of allotment of issue on various website after allotment is completed. You can find out yourself chances of getting no. of shares in book built IPO by viewing final bids catagorywise at nse-india dot com late at 9/10 PM on closing day or next morning.
CUT OFF BIDS :ONLY RETAIL INVESTORS are allowed to bid at cut off price which they must avail . It is just like an open price bid with an agreement that whatever price is determined shall be acceptable to retail bidders,for this they deposit higher cap amount i.e. 60 in this example case .
ALLOTMENT SYSTEM WHEN LOTTERY IS REQUIRED:
an issue can have minimum lot between Rs.5000 to Rs.7000 only, so retail application may be of 14 lot to 20 lot depending on value of minimum application amount,
Now for allotment of shares all retail applications are saggregated lot wise and demand in each portion is calculated ; now depending on quantum of oversubscription and total shares reserved for retail catagory , each portions demand and share entitlement is worked out and then ,since mimimum allotment has to be minimum application lot,shares alloted to applicants by lottery . In one lot application it may be 1 out 30 is alloted and in 20 lot application it may be 9 out of 10 are alloted depending on demand in these lots ; so probability of allotment is more in higher quantity application
EXAMPLE CASE = limit 1 lac minimum lot 100 shares price range 55 to 60 scrip XYZ
1 ) FIRM ALLOTMENT : when the issue is FULLY / PARTLY SUBSCRIBED firm allotment is made for no. of shares as applied by you .
2 )PROPORTONATE ALLOTMENT : when a issue is OVERSUBSCRIBED proportionate allotment is made .
A) if issue oversubscribed 6.5 times in retail then divide your application quantity by 6.5 and shares will be alloted in multiple of 1 share above minimum lot i.e. 108,123,and so on. however persons applying between 100 to 600 shares if they divide by 6.5 then the shares will work out less than 100 ,since minimum allotment has to be 100 shares instead of rejecting these applications ,applicants between 100 to 600 shares will be allotted 100 shares by lottery whether u have applied 100 or 600 shares . ofcourse probability for success in lottery will be better for those applying 600 shares over those applying 100 shares.
B) issue oversubscribed more then retail limit say above 17 times in this case then one will get allocation of minimum lot of 100 shares alloted by lottery whether have applied for 100 shares or full 1600 shares with different probability chances i.e. 1600 application will have better chance over 100 share application in lottery.
Hope u will find this informative,and will understand the allotment procedure , You can also view basis of allotment of issue on various website after allotment is completed. You can find out yourself chances of getting no. of shares in book built IPO by viewing final bids catagorywise at nse-india dot com late at 9/10 PM on closing day or next morning.
CUT OFF BIDS :ONLY RETAIL INVESTORS are allowed to bid at cut off price which they must avail . It is just like an open price bid with an agreement that whatever price is determined shall be acceptable to retail bidders,for this they deposit higher cap amount i.e. 60 in this example case .
ALLOTMENT SYSTEM WHEN LOTTERY IS REQUIRED:
an issue can have minimum lot between Rs.5000 to Rs.7000 only, so retail application may be of 14 lot to 20 lot depending on value of minimum application amount,
Now for allotment of shares all retail applications are saggregated lot wise and demand in each portion is calculated ; now depending on quantum of oversubscription and total shares reserved for retail catagory , each portions demand and share entitlement is worked out and then ,since mimimum allotment has to be minimum application lot,shares alloted to applicants by lottery . In one lot application it may be 1 out 30 is alloted and in 20 lot application it may be 9 out of 10 are alloted depending on demand in these lots ; so probability of allotment is more in higher quantity application
