Basis Of Allotment

The basis of allotment is the document published by an IPO-issuing company after the close of the subscription window — detailing the methodology used to allocate shares among applicants in different investor categories (QIBs, Non-Institutional Investors, and Retail Individual Investors) when the IPO is oversubscribed. For the retail category, which is most commonly oversubscribed, the basis of allotment specifies the proportionate allotment method or the lottery-based allotment method used — depending on the level of oversubscription. If the retail category is oversubscribed by less than a certain threshold, proportionate allotment applies (each applicant receives a proportionate share of their application). If it is very heavily oversubscribed, a lottery is used to select which applicants receive at least one lot, ensuring maximum dispersal among retail investors. The basis of allotment document is published on the BSE and NSE websites, the registrar's website, and the IPO's official website — typically 6 days after the IPO closing date. For Indian IPO investors, checking the basis of allotment explains precisely how many shares were allotted per application, the total oversubscription in each category, and the allotment ratios — enabling investors to verify their allotment through the registrar's portal or CDSL's EASI platform using their application number or PAN.