SBI Cards IPO Employees Application - Explained

Published on Tuesday, December 10, 2019 by Chittorgarh.com Team | Modified on Wednesday, February 26, 2020

SBI Cards and Payment Services Ltd is a payment solution provider in India. Incorporated in 1998, SBI Card is a venture of State Bank of India (SBI). SBI Cards IPO opens on 2nd March 2020 and closes on 5th March 2020 (4th March for QIB bidders). .

As per the RHP document, SBI Employees can apply in SBI Cards IPO under the reserved category for Employees with certain terms and conditions. This article provides detail about how SBI current and a retired employee of SBI can benefit by applying in SBI Cards IPO under retail, employee and shareholders category of the IPO.

The rules for investing in SBI Cards IPO for SBI employees are as below:

Eligibility for Applying in SBI Employees Quota

• A permanent employee of SBI Cards or SBI, working in India or outside India (excluding employees who are not eligible to invest in the Offer under laws).
• A whole-time or part-time Director of SBI Cards who is eligible to apply under the Employee Reservation Portion on 18th Feb 2020 and who continues to be a Director of SBI Cards, until the submission of the Bid cum Application Form.
• SBI Retired Employees are not eligible to apply in SBI Cards IPO under employee quota.

Note-

• Eligible Employees should mention their employee number at the relevant place in the Bid cum Application Form.
• Directors who directly or indirectly, hold more than 10% of the outstanding Equity Shares in SBI Cards are not eligible to apply.

Read more about SBI Cards IPO

• SBI Cards IPO Detail
• SBI Cards IPO Live News
• SBI Cards IPO Shareholders Application - Explained
• SBI Cards IPO FAQs

Maximum Eligible Bidding Limit in SBI Employees Category

Rs 500,000 is the Maximum limit to apply under the employee category of SBI Cards IPO. But the process allotment will be as below:

• If IPO oversubscribed in the employee category, a maximum Rs 2L bid will be accepted.
• If IPO under-subscribed in the employee category, the unsubscribed portion may be allocated on a proportionate basis to Eligible Employees Bidding in the Employee Reservation Portion, for a value in excess of Rs 200,000, subject to the total Allotment to an Eligible Employee not exceeding Rs 500,000.

Bidding Rules in SBI Employees Portion

• The Bid must be for a minimum of 19 Equity Shares and in multiples of 19 Equity Shares to a Maximum Bid Amount of Rs 5 Lakhs.
• Eligible Employees under the Employee Reservation Portion may Bid at Cut-off Price.
• Only those Bids, received at or above the Offer Price, net of Employee Discount, would be considered for Allotment.
• In the case of joint bids, the First Bidder shall be an Eligible Employee.
• Eligible Employees shall not Bid through the UPI mechanism.

Application Rules for Bidding in Multiple Categories (Employee)

• SBI Employees can bid in multiple categories using one demat account (PAN Number). This includes
  • Employee Category
  • Shareholders Category
  • General Retail Category

If applying in multiple categories, the maximum limit will be as below:

* Bid under Retail Individual Bidders Portion for upto Rs 200,000 OR in Non-Institutional Bidders Portion such that the Bid Amount exceeds Rs 200,000 but not exceeding the size of the Net Offer (excluding QIB portion).

Allocation Rules in SBI Employees Category

If total demand in the employee category is less than or equal to 1,864,669 Equity Shares (total shares allocated to employees) at or above the Offer Price, the full allocation shall be made to the Eligible Employees.

In case of an under-subscription in the Employee Reservation Portion, the unsubscribed shares may be allocated on a proportionate basis to employees bidding in excess of Rs 200,000. However, the total allotment in under-subscription, as well as over-subscription, will not exceed Rs 500,000.

Rules for Eligible Employees as per RHP (Page 441)

The Bid must be for a minimum of 19 Equity Shares and in multiples of 19 Equity Shares thereafter so as to ensure that the Bid Amount payable by the Eligible Employee does not exceed Rs 500,000 on a net basis. However, the initial allocation to an Eligible Employee in the Employee Reservation Portion shall not exceed Rs 200,000 (which will be less Employee Discount). Only in the event of an under-subscription in the Employee Reservation Portion post the initial allocation, such unsubscribed portion may be allocated on a proportionate basis to Eligible Employees Bidding in the Employee Reservation Portion, for a value in excess of Rs 200,000, subject to the total Allotment to an Eligible Employee not exceeding Rs 500,000 (which will be less Employee Discount). Eligible Employees under the Employee Reservation Portion may Bid at Cut-off Price.

Bids under Employee Reservation Portion by Eligible Employees shall be:

• Made only in the prescribed Bid cum Application Form or Revision Form (i.e. [.] colour form).
• The Bid must be for a minimum of 19 Equity Shares and in multiples of 19 Equity Shares thereafter so as to ensure that the Bid Amount payable by the Eligible Employee subject to a maximum Bid Amount of Rs 500,000 (which will be less Employee Discount) on a net basis. Eligible Employees under the Employee Reservation Portion may Bid at Cut-off Price.
• Eligible Employees should mention their employee number at the relevant place in the Bid cum Application Form.
• Only Eligible Employees would be eligible to apply in this Offer under the Employee Reservation Portion and the Bidder should be an Eligible Employee as defined above.
• Bids by Eligible Employees in the Employee Reservation Portion and in the Net Offer portion shall not be treated as multiple Bids. Further, bids by Eligible Employees in the Employee Reservation Portion and in the SBI Shareholders Reservation Portion (subject to Bid Amount being up to Rs 200,000), as SBI Shareholders, shall also not be treated as multiple Bids. Therefore, Eligible Employees bidding in the Employee Reservation Portion and the SBI Shareholders Reservation Portion (subject to the Bid Amount being up to Rs 200,000) can also Bid under the Net Offer and such Bids will not be treated as multiple Bids. Our Company reserves the right to reject, in its absolute discretion, all or any multiple Bids in any or all categories.
• Only those Bids, which are received at or above the Offer Price, net of Employee Discount, if any, would be considered for Allotment under this category.
• Eligible Employees can also Bid in the Net Offer to the Public and such Bids shall not be treated as multiple Bids.
• In case of joint bids, the First Bidder shall be an Eligible Employee.
• Eligible Employees shall not Bid through the UPI mechanism.
• If the aggregate demand in this category is less than or equal to 1,864,669 Equity Shares at or above the Offer Price, full allocation shall be made to the Eligible Employees to the extent of their demand.

In the event of under-subscription in the Employee Reservation Portion, the unsubscribed portion will be available for allocation and Allotment, proportionately to all Eligible Employees who have Bid in excess of Rs 200,000, subject to the maximum value of Allotment made to such Eligible Employee not exceeding Rs 500,000.

Under-subscription, if any, in any category including the Employee Reservation Portion and the SBI Shareholders Reservation Portion, except in the QIB Portion, would be allowed to be met with spill over from any other category or a combination of categories at the discretion of our Company in consultation with the BRLMs and the Designated Stock Exchange.