Prajna Capital - An Investment Guide

Collection Of Applications Via ASBA Route Is Just 13% THE merits of Application Supported by Blocked Amount ( ASBA ), splashed across public issue advertisements, have done little to popularise the facility among retail investors. Lack of investor awareness, non-availability of forms and the tussle between banks and brokers are said to be the main reasons for the tepid response towards ASBA. Collection of retail application through the ASBA route has been around 13-15%, despite primary market intermediaries and capital markets regulator Sebi striving to make the option more popular. ASBA refers to an application mechanism for subscribing to initial public offers ( IPO ), which ensures that the applicant’s money remains in his bank account till the shares are allotted. The mechanism requires the applicant to give an authorisation to block his application money in the bank account. The bank account is debited only after the allotment is finalised, or the IPO is withdrawn or fails....