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Application supported by Blocked Amount (ASBA) enables investors to apply for primary market issues like initial public offering (IPO) without making immediate payment. The application amount is “Blocked” in the investor’s bank account and is released in a proportionate amount on allotment of shares.Read More
With this facility, investors can immediately carry out new IPO application without worrying about payment. The amount it debited only if shares of the latest IPO are allotted. What’s more? Application for ASBA IPO has zero charges. On top of that, the blocked amount also earns interest when it is not used to invest in IPO. All in all, it is win-win for investors!Read Less
Initial Public Offering (IPO)
What do you need to apply in Initial Public Offering (IPO) application through ASBA?
· An account with IDFC FIRST Bank
· Demat account with depository participant of CDSL or NSDL
· Updated PAN details
Sufficient funds in your bank account
Details you will need to check before and after applying for Public Issue:
· Allotment status: Refer RTA website for allotment
You can also apply offline by visiting any of the IDFC FIRST Bank ASBA branches. Offline ASBA applications at the branch will be accepted only before 1:00 PM on last day of public issue.
ASBA means “Application Supported by Blocked Amount”. ASBA is an application by an investor containing an authorization to Self Certified Syndicate Bank (SCSB) to block the application money in the bank account, for subscribing to an issue. If an investor is applying through ASBA, his application money shall be debited from the bank account only if his/her application is selected for allotment after the basis of allotment is finalized.
SEBI has been specifying the investors who can apply through ASBA. In public issues w.e.f. May 1, 2010 all the investors can apply through ASBA.
Applying through ASBA facility has the following advantages:
(i) The investor need not pay the application money by cheque rather the investor submits ASBA which accompanies an authorization to block the bank account to the extent of the application money.
(ii) The investor does not have to bother about refunds, as in ASBA only that much money to the extent required for allotment of securities, is deducted from the bank account only when his application is selected for allotment after the basis of allotment is finalized.
(iii) The investor continues to earn interest on the application money as the same remains in the bank account, which is not the case in other modes of payment.
(iv) The investor deals with the known intermediary i.e. its own bank.
Yes, it is mandatory. A retail investor making application through ASBA
List of Self Certified Syndicate Banks (SCSBs) and their designed branches i.e. branches where ASBA application form can be submitted, is available on the websites of BSE (www.bseindia.com) and NSE (www.nseindia.com) and on the website of SEBI (www.sebi.gov.in). The list of SCSB would also be given in the ASBA application form.
No, ASBA can be submitted to the SCSB with which the investor is holding the bank account.
No, you can either fill up the physical ASBA form available with SCSB and submit the same to the SCSB or apply electronically/online through the internet banking facility for IPO.
Retail individual investors can withdraw ASBA bids. During the bidding period you can approach the same bank to which you had submitted the ASBA and request for withdrawal through a duly signed letter citing your application number, Application number, if any.
After the bid closure period, you may send withdrawal request to the Registrar to the issue before the finalization of basis of allotment, who will cancel the bid and instruct SCSB to unblock the application money in the bank account after the finalization of basis of allotment.
However, Non-retail investors i.e. Qualified Institutional Buyers and Non Institutional Investors are not eligible to withdraw their bids at any time.
No, the entire bank account will not be blocked. Only the amount to the extent of application money authorized in the ASBA will be blocked in the bank account. The balance money, if any, in the account can still be used for other purposes.
If the withdrawal is made during the bidding period, the SCSB deletes the bid and unblocks the application money in the bank account.
If the withdrawal is made after the bid closure date, the SCSB will unblock the application money only after getting appropriate instruction from the Registrar, which is after the finalization of basis of allotment in the issue.
No. It is not necessary to have a DP account with the SCSB, where you are submitting the ASBA.
Yes, you can submit ASBA with a registered broker of the stock exchange where the securities are proposed to be listed. However, the brokers would only upload the bid and other relevant details of such ASBA forms in the bidding platform provided by the stock exchanges and forward the ASBA forms to the respective SCSBs for blocking the funds for amount above 2L. Amount below 2L will be done through UPI 2.0 process.
Yes. The SCSB shall give a counterfoil as an acknowledgement at the time of submission of ASBA and also the order number, generated at the time of uploading the application details, if sought by the investors in case of need.
In case the issue fails/withdrawn the SCSB shall unblock the application money from the bank accounts upon receiving instructions from the Registrar.
Yes, this can be done provided that your bank has core banking facility and the ASBA form is submitted at a branch which is identified as designated branch by the bank.
The chance of getting allotment is same for all the applicants whether application is made through ASBA or non‐ASBA. ASBA is a simple, easy and smart way of applying in public issues. There are many advantages of applying through ASBA like money does not go out of investors’ account, no hassle of refund, investor keep earning interest on the blocked amount as banks have started paying interest on daily basis w.e.f. April 1, 2010 and it gives better opportunity for utilization of money
In case investor does not have an account with any of the SCSBs, then he cannot make use of the ASBA facility.
One applications can be made from a bank account per PAN.
You may raise a complaint from the UPI App where you have placed the order or bring the issue to the knowledge of your bank through any other mode against the Unique Mandate Number for hold marked in bank account.
There are 3 investor categories available for bid:
Retail Individual Investor (RII) : Any individual/NRI/HUF application or bid for securities of or for a value of not more than 2,00,000/- and can apply at Cut off Value
Non Institutional Investor (NII): Any high Net worth Individual with application or bid for securities for value more than 2,00,000/- and cannot apply at Cut off Value
Qualified Institutional Buyer (QIB) : Investor category as Mutual Funds, Public Financial Institutions, Foreign Portfolio Investors and Commercial bank
Yes, however the investor should note that:
A retail Individual Investor can revise the IPO application any time during the bidding period without any restriction. A Non Institutional Investor/ HNI can revise the IPO application only to upgrade the bid application. Downgrade from the existing Bid Application is not permitted to Non Institutional Investor/HNI category.