Expected Basis of Allotment

EXPECTED BASIS OF ALLOTMENT (RETAIL) FOR -
HDFC ASSET MANAGEMENT COMPANY LTD

Let us consider an example of HDFC Asset Management Company Ltd where issue is oversubscibed more than 83 times & Retail Category is oversubscribed more than 4 times.

Still basis of allotment is not declared for HDFC AMC, But from IPO allotment process example we can estimate approx. what should be the ratio & basis of allotment for HDFC AMC.

Category  - Retail
Reserved shares  - 77,62,145
Lot  - 13 shares
Approx. Total no of Applications - 25,78,000      (of which valid Retail Appl. @ Cut off price - 25,16,173)
No. of Shares applied for Retail Category - 5,22,27,734    (of which valid @cut off price -  4,77,54,096)

**** Figures given are sample  purpose only (not actual )
Ratio is considered as 14 applications out of  every 59 applications should be selected for allotment.

   One application which applied more than 13 shares will get 1 additional share.

IPO Allotment process for retail category

IPO Allotment process for Non Institutional Investors (NII/HNI)

IPO Allotment Process - NII/HNI

IPO Allotment process for Non Institutional Investors (NII/HNI)

Basis of Allotment for Non Institutional Investors (NII/HNI) category slightly different from Retail category.

The process till seperation of applications as per lots applied & calculation of lotwise %age of total is same.

But the ratio calculation is different for both category.

In retail ratio %age is nearly fixed for all lots category i.e. ratio %age is same for lots applied 1, 2, 3,4......16.
eg. if ratio is fixed for who applied 1 lot is 65:247 (ratio %age 27.53), then this ratio %age is same for all lots category.

Allocation of shares for retail is always in lots, but for NII it may not be exactly in lots.

In case of NII the ratio %age is different for all lots category applied. The ratio %age is as actual total % applied for lots category. eg. 

     Category  - NII
     1 Lot = 18 shares
     Reserved  shares for NII category                      = 2314080
     total applied shares for NII category                   = 366625224
     total shares applied for 14 lots i.e. 252 shares     =  43092            (171 appl. for 252 shares)
    %age out of total shares applied                          =  0.0117           (43092   /  366625224)

    Total reserved shares for application of 14 lots (252 shares)  = 270     (2314080 * 0.0117 / 100)

   Again ratio is calculated for these 270 shares for allotment to 171 applications. eg. 15 : 171
  (15 applications out of 171 appl. allotted 18 shares each  i.e 15 * 18 = 270)


Below is a chart for sample Basis of Allotment of BSE Ltd. ipo, which describes how shares is alloted & ratio for allotment in NII Category.

Category  - NII
Reserved shares  - 2314080
Total applied shares for NII category                   = 366625224
Reserved  shares for NII category                       = 2314080
1 Lot  - 18 shares

IPO Allotment process for Retail Category

Current IPO

Company	Issue Period	F.V.	Price Band	Lot size	Basis of Allotment	Initiation of Refunds	Listing	Status
HDFC AMC	25 Jul - 27 Jul	5	1095-1100	13	01-08-2018	02-08-2018	06-08-2018	Closed

IPO Allotment Process for Retail Category

IPO Allotment process for retail category

Basis of Allotment is done after issue bid is closed & before actual allotment is done. It is the process in which how the allotment is done is finalized for different categories.  Basis of Allotment is mainly important when the issue is oversubscribed, because all the applicants can't get allotment. Registrar have to select the applicants for allotment to shares reserved in each category.

In category applications are again seperated on the basis of lots(shares) applied. Lotwise applications & applied no. of shares percentage is calculated. On the basis of % then ratio is finalised for each category & lotwise applications.



Below is a chart which describes how shares is alloted & ratio for allotment in Retail Category.

Example - 1
Category  - Retail
Reserved shares  - 1,89,26,183
Lot  - 65 shares
Approx. Total no of Applications - 10,73,971      (of which Retail Appl. @ Cut off price - 10,57,654)
No. of Shares applied for Retail Category - 11,91,57,935    (of which @cut off price -  11,64,45,355)

**** Figures given are sample  purpose only (not actual )
**** Ratio for Allotment decided by Registrar in consultation with Stock Exchange eg.  68 : 247  (27.53 %) means from every 247 applications 68 applications selected for allotment.
 

Selection of application from every category (no. of shares applied) done seperately as per ratio. Ratio for lots (no. of shares applied) can be same or different but ratio %age is nearly about same.

The ratio & %age will be different for every IPO depending on the issue oversubscribed.

 IPO Allotment process for Non Institutional Investors (NII/HNI)

Expected Basis of Allotment for HDFC AMC Ltd