Analysis and Insights into the world of IPOs and investing in India

Sunday, May 1, 2011

ASBA to become mandatory for Non-Retail Investors

In a remarkable move in the area of public issues and rights issues, SEBI has made Applications Supported by Blocked Amount (ASBA) facility compulsory for all Non-Retail Investors. Thus, QIB and HNI Category of Investors would now have to obligatorily invest in IPOs or Rights Issues using ASBA facility

ASBA (Application Supported by Blocked Amounts) is a process developed by the Securities and Exchange Board Of India (SEBI) for applying to IPO. In ASBA, an IPO applicant's account is earmarked and does not get debited until shares are alloted to him. However, there has to be sufficient funds in the account before it can be earmarked

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