Over Rs 3.40 crore worth of investment rejected in Swadeshi Laghubitta IPO; proves stock market literacy essential

Swadeshi Laghubitta Bittiya Sanstha Limited had issued 3 lakh units IPO shares to the general public from Chaitra 25 to Chaitra 29, 2073. The issue, that had collected more than Rs 3.26 arba, concluded today after the shares were allotted to the applicants. Applicants who had applied up to 1,120 units shares (up to Rs 1,12,000) were allotted 10 units via lottery and others above 1,130 units were allotted 0.835% on pro-rata basis. Out of the total 90,816 valid applicants, only 25,030 got the shares. However, 1,206 applicants were disqualified in this IPO. The issue, that is worth Rs 3 crore only, rejected Rs 3.40 crore due to invalid applications. As per NMB Capital, the issue manager, some applications were disqualified due to wrong BOID number (demat account number), some were rejected due to duplicate/multiple applications, and some had applied odd kitta (not divisible by 10). Moreover, some applicants had also applied less than 50 units and more than 1,500 units. Applications with minimum of 50 units and maximum of 1,500 units were called for this IPO.

Reason for disqualification	No. of applicants	Applied Amount (Rs.)
Applied for Odd Kitta	33	449,600
Multiple Applications	28	825,000
BOID Not Verified	1,129	32,003,600
Applied for less than 50 units or more than 1,500 units	16	742,000
TOTAL	1,206	34,020,200

Such huge number of applications that were rejected due to not providing correct demat number or multiple applications shows that some investors are also trying to exploit the system. NMB Capital, in this case, has done an impressive work to identify such exploits and reject them. Duplicate applications were also received from applicants who had applied directly and did not know their portfolio management service had applied on their behalf. This shows that officers managing for their clients should constantly be in communication with their clients and inform them of all investment means. In this case, both the application made by the client and the portfolio manager were denied. Similarly, for those applications that had applied for less than 50 units, this is also an issue with staffs not being properly trained to handle the applications. As per the issue manager, branches of banks that cater to rural areas have accepted such applications through ASBA. All these rejections boil down to the increased need of share market literacy for investors and competent training for staffs. Similar issues were also encountered in the past IPOs Individual results of IPO allotment can be checked at ShareSansar’s IPO Result section. Search by first name and last name or by entering the BOID.