How IPO shares are allotted in Nepal
When more people apply for an IPO than there are shares, the issue is oversubscribed and the shares go out by lottery. Each winner usually gets the minimum lot of 10 units, so the number of winners is the units offered to the general public divided by 10.
Your chance is that number of winners divided by the number of valid applicants. Applying for more than the minimum does not raise the chance in the usual lottery; applying from more demat accounts does, since each account is a separate ticket.
Example
25 lakh units to the public at 10 units each make 2.5 lakh winners. With 12 lakh applicants the chance is 2.5 ÷ 12, about 20.8%, or 1 in 5. Applying from four family accounts, the chance that at least one is allotted is about 60.7%.
The registrar's rules for each issue decide, including what happens to any units left over after the lottery.
Questions people ask
How is IPO allotment done in Nepal?
When an IPO is oversubscribed, a lottery picks the applicants who get shares, usually the minimum lot of 10 units each. When it is not, every applicant gets shares.
Does applying for more IPO units increase my chance?
Not in the usual lottery, where each valid applicant has the same chance whatever they applied for. Only the number of separate accounts applying changes the odds.
How do I calculate my IPO chance?
Divide the units for the general public by the units per winner to get the number of winners, then divide by the number of valid applicants.
When is the money unblocked if I do not get shares?
The amount blocked in your bank through the application is released after the allotment, when the result is published.
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