IPO allotment of Janautthan tomorrow, Barun Hydro before Baishakh 10; allotments likely thru lottery

ShareSansar April 12:

While the announcement regarding the allotment of shares in the Initial Public Offering of Janautthan Samudayic Laghubitta Bikas Bank Limited will be made on Chaitra 30 (Monday), Barun Hydropower Company Limited has until Baishakh 10 to make the allocations.  

SEBON rules require the allotments to take place within 40 days after the IPOs close. But in case of IPOs that receive more than 1 lakh applications, companies are given maximum 50 days to announce the allotment.

While Janautthan had received around 75,000 applications, Barun Hydropower--whose IPO closed on Falgun 20--had received 1 lakh 4 thousand applications. So, Barun still has about 10 days to announce the allotment.  

An official with the Growmore Merchant Banker, the issue manager for Janautthan IPO, said that all the details regarding the IPO will be made public on Monday at the premises of Growmore Merchant Banker Limited, Durbarmarg, Kathmandu at 8am.

While the IPO of Janautthan was oversubscribed 355 times, Barun raised funds more than 100 times its target.
Since both IPOs were highly oversubscribed, under the pro rata basis the chances of each investor getting a minimum of 10 shares--also a rule set by SEBON--seem unlikely.

Therefore, the allotment in both cases is likely to take place through lottery.