Page 11 - 1411_Value Plus May 2016

ASBA SIMPLIFIED Why is ASBA beneficial to investors like you
and me?
What is ASBA?
Applying through ASBA mode is a win-win for
Applicatiotn Supported by Blocked investor because:
Amount - Mode of applying in IPO
(i) Earn interest on application money: You
How does ASBA work? continue to earn interest on the application
money as the amount remains in your bank
O er Period: account and is just held on respective days.

Time period when you (ii) No need for cheque payments: The investor
can apply in an IPO – does not need to pay application money
ranges from 3-4 days through cheque, he has to just submit ASBA
form which accompanies authorization to
T Day: LAST block the amount in his bank account.
DAY
Last date of offer or last (iii) No follow up for refund: The cumbersome
day when you can follow of refunds is done away with, as
apply money to the extent required for allotment
of securities, is only debited from your bank
T+3 Day: account. Further, in case of non-allotment
of securities, the blocked money is released
Final allotment done by after the basis of allotment is finalized.
Registrar
(iv) Early exit: You get early exit as listing of
DEMAT T+5: T+4 Day: securities takes place on T+6th day, for
investors who wish to book profits.
Credit of shares to Unblocking of amount
depository if shares from your bank account – Is an applicant allowed to withdraw ASBA
allotted if no allotment or bids?
Debit of money from
bank account – if shares are Yes. During the bidding period, one can
allotted approach SCSB, to which he/she had submitted
the application and make a withdrawal request,
T+6: post which, the bank will unblock the amount.
After the bid closure period, applicants need to
Listing of shares on send their withdrawal requests to the Registrars
exchange, trading in order to withdraw their bids.
commences
How many applications can be made from a
Advantages bank account?

• Earn interest on application money SCSBs have to ensure that not more than five
• No need for cheque payments applications can be made from a bank account
• No follow up for refund per issue. This means third party applications are
• Early exit allowed from your bank account.

How many applications can be made Can I withdraw the amount blocked in favor of
from single bank account? ASBA application?

5 applications No, the amount blocked in your bank account
supporting the ASBA application cannot be
withdrawn till the time of allotment.

What would happen if the issue is withdrawn
or fails?

Under such circumstances, the application
money is unblocked in your bank account after
receiving communication from the Registrars to
the issue.

11 ARIHANT CAPITAL ¡ MAY 2016