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SBI Cards IPO Shareholders Application - Explained

Published on Monday, December 9, 2019 by Chittorgarh.com Team

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SBI Cards IPO Shareholders Application - Explained

SBI Cards and Payment Services Limited, a subsidiary of SBI, is coming up with an IPO. The dates of the IPO, lot size and offer price etc., are not announced yet. There's a special category of investor reservation portion for SBI shareholders. As per the SBI Cards IPO DRHP filed by the company, here are the rules for investing in SBI Cards IPO for SBI holders:


Eligibility for applying in SBI Shareholders Quota

  • SBI Shareholders i.e. individuals and HUFs who are equity shareholders of SBI can only apply.
  • The person on whose name the IPO application is made needs to be an SBI shareholder. Any other individual cannot apply in this category.

Maximum Eligible Bidding Limit in SBI Shareholders Quota

ScenarioMaximum Eligible Bidding Limit

1

Applying only in Shareholders Category (as retail individual shareholder)

₹200,000 in Shareholders *

2

Applying Shareholders and Retail Category Both

₹200,000 in Shareholders

₹200,000 in Retail

3

Applying in:

Shareholders Category

RII Category

Employee Category

₹200,000 in Shareholders

₹200,000 in Retail

₹500,000 in Employee

* Though it's not mentioned in the DRHP, it is by the SEBI law for IPO.


Bidding Price Rules in SBI Shareholders Portion

  • Applications with bids, above the Offer Price, would be considered for allocation under this category.
  • The Bids must be for a minimum of [.] Equity Shares and in multiples of [.] Equity Shares thereafter.
  • Applicants in the SBI Shareholders Reservation Portion (up to ₹200,000) are allowed to bid at Cut-off Price.

Read more about SBI Cards IPO


Application Rules for Bidding in Multiple Categories

  • SBI Shareholders bidding in the SBI Shareholders Reservation Portion above ₹200,000 cannot Bid in the retail or employee category.
  • SBI Shareholders bidding in the SBI Shareholders Reservation Portion (up to ₹200,000) and bidding in the Employee Reservation Portion (as Eligible Employees) can also Bid in the retail category.

Allocation Rules in SBI Shareholders Category

  • If the aggregate demand in this category is less than or equal to 13,052,680 Equity Shares at or above the Offer Price, all the applicants will get a full allocation.
  • In case of the IPO being under-subscribed in the SBI Shareholders Reservation Portion, the allocation would be met with shares from other reservation portions.

Rules for SBI Shareholders in DRHP Document

Bids under the SBI Shareholders Reservation Portion shall be subject to the following:

  1. Only SBI Shareholders (i.e. individuals and HUFs who are equity shareholders of SBI (excluding such other persons not eligible under applicable laws, rules, regulations and guidelines) as at the date of the Red Herring Prospectus) would be eligible to apply in this Offer under the SBI Shareholders Reservation Portion.
  2. The sole/ First Bidder shall be a SBI Shareholder.
  3. Only those Bids, which are received at or above the Offer Price, would be considered for allocation under this category.
  4. The Bids must be for a minimum of [.] Equity Shares and in multiples of [.] Equity Shares thereafter. Bids by SBI Shareholders in SBI Shareholders Reservation Portion (subject to Bid Amount being up to ₹200,000) and in the Net Offer portion shall not be treated as multiple Bids. To clarify, an SBI Shareholders bidding in the SBI Shareholders Reservation Portion above ₹200,000 cannot Bid in the Net Offer as such Bids will be treated as multiple Bids. Further, bids by SBI Shareholders in SBI Shareholders Reservation Portion (subject to Bid Amount being up to ₹200,000) and in the Employee Reservation Portion (as Eligible Employees), shall not be treated as multiple Bids Therefore, SBI Shareholders bidding in the SBI Shareholders Reservation Portion (subject to the Bid Amount being up to ₹200,000) and bidding in the Employee Reservation Portion (as Eligible Employees) 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.
  5. If the aggregate demand in this category is less than or equal to 13,052,680 Equity Shares at or above the Offer Price, full allocation shall be made to the SBI Shareholders to the extent of their demand.
  6. Under-subscription, if any, in any category including the SBI Shareholders Reservation Portion and the Employee 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.
  7. SBI Shareholders Bidding under the SBI Shareholders Reservation Portion (subject to the Bid Amount being up to ₹200,000) are entitled to Bid at the Cut-off Price.

If the aggregate demand in this category is greater than 13,052,680 Equity Shares at or above the Offer Price, the allocation shall be made on a proportionate basis.

FAQ's

  1. 1. What is a cut-off date for SBI shareholders in SBI Cards IPO?

    The cut-off date is the date of RHP filing. Any investor who holds 1 or more shares of SBI on the cut-off date will be eligible for applying under shareholders category of SBI Cards IPO.

    Note:

    • As of 09 Dec 2019, only the Draft Red-Herring Prospectus (DRHP) is filed with SEBI. SEBI has yet to approve DRHP.
    • The RHP is usually filed a week before the public issue opens.
    • You can buy 1 share of SBI and hold it until the public issue opens to become eligible for shareholder's quota.

    Discuss this question

  2. 2. How many shares of SBI are required to be eligible for SBI Cards shareholder quota?

    The minimum one share of SBI is enough to be eligible to participate in the SBI Cards IPO under the shareholder's category.

    Note

    • A higher number of shares doesn't increase the chance of allotment.
    • If you hold even 1 share of SBI on the cut-off date (when RHP of SBI Cards IPO is filed), you will be eligible to apply under shareholder's quota.

    Discuss this question

  3. 3. Can I apply 2 lakhs each in the shareholder's category and Retail category (Total 4 lacs)?

    Yes, you can apply in both shareholder category and retail category up to Rs 2 lakhs in each category of SBI Cards IPO.

    Discuss this question

  4. 4. Can I apply in both shareholders and retail categories from the same Demat account in SBI Cards IPO?

    Yes, you can apply in both retail and shareholders categories of SBI Cards IPO using the same demat account. Note that in this case, you are eligible for a maximum limit of ₹200,000 in each category (A total of Rs 4L).

    Discuss this question

  5. 5. Can I apply in the name of my family members from my single bank account in the SBI shareholder quota for SBI Cards IPO?

    No, in SBI shareholder's quota, the person on whose name the IPO application is made needs to be an SBI shareholder. Other individuals cannot apply in shareholders category of SBI Cards IPO.

    Discuss this question

  6. 6. Is there any restriction to apply from the linked bank account only in the SBI Cards IPO shareholder category?

    The name in SBI Cards IPO Application Form and Demat Account (where you holding SBI shares) should be the same.

    Anyway, as per the updated process in applying in IPO, the name of the primary account holder in the bank should match the IPO application and Demat Account.

    Discuss this question

  7. 7. All my family members hold SBI shares. Is it possible to make 10 applications (5 retail + 5 shareholders) from the same bank account?

    Traditionally, you could apply in 5 IPO applications (anyone's name) using one bank account with SBI. This is the same as Axis Bank and PNB bank.

    We are not sure if SBI online banking will allow 5 retail + 5 shareholders applications from one bank account in SBI Cards IPO. We will keep posting updates as we receive from the bank.

    Discuss this question

  8. 8. In SBI Cards IPO, does allotment chances change by the number of SBI shares I hold?

    No, the allotment will not be done based on the number of SBI shares owned by you in SBI Cards IPO. As long as you are an eligible shareholder of SBI, the chances of allotment are the same.

    Discuss this question

  9. 9. How many SBI shares I require to apply in the SBI Cards shareholders category?

    One share of SBI on a cut-off day in your demat account is enough to be eligible for the SBI Cards IPO shareholders reservation category.

    Discuss this question

  10. 10. Till what date I can buy SBI shares to be eligible to apply in the shareholder's category of SBI Card?

    The cut-off date i.e. the date on which you should own the SBI shares is the date when the company will file the Red Herring-Prospectus (RHP).

    It is early to say when that date will be as SBI Cards has just filed the DRHP with SEBI. Once SEBI approves the DRHP, the company will publish the RHP and the cut-off date. The RHP usually published a week before the IPO open date.

    Get latest updates on SBI Cards IPO page.

    Discuss this question

  11. 11. How can we know on what date DRHP submitted for IPO? On which website this information is available?

    SBI Cards filed the DRHP (Draft Red Herring Prospectus) with SEBI on November 26, 2019. You can get the details here.

    Note that in the case of SBI Cards IPO, the cut-off date for eligibility of shareholders quota is the date when RHP is filed. Companies usually file RHP around a week before IPO opens for the public.

    Discuss this question

  12. 12. Can applications in both shareholder and retail categories be made through PNB Online ASBA?

    Yes the PNB account holders should be able to apply in both shareholders and retail category of SBI Cards IPO.

    But as per the information, there is a technical limitation in PNB Online IPO Application which only allows one application per PAN number. The bank has informed us that they are working to fix this issue. Hopefully, before the SBI Cards IPO opens, this should be fixed.

    Discuss this question

  13. 13. Is the category limit for both shareholders and retail category is Rs 2 lakhs combined or is it Rs 2 lakhs limit for each category?

    The amount of the bid should not exceed ₹200,000 in each shareholder and retail categories in SBI Cards IPO.

    For example, a shareholder can apply in following two ways:

    CategoryMaximum Limit

    1

    Apply in both category

    Maximum Rs 2L in Retail + Maximum Rs 2L in Shareholders

    2

    Apply only in shareholders category

    Maximum Rs 2L

    Discuss this question

  14. 14. Can I apply from my relative account with ASBA in the shareholder category and individual both (each Rs 2 lakh)?

    We are still looking for the answer to this question.

    Discuss this question

  15. 15. What is the date for SBI shareholders to eligible for applying for shareholder's quota?

    An individual can apply in the Shareholders category if he holds the SBI shares on the day of filing the SBI Cards IPO RHP (Ref Herring-Prospectus). For SBI Cards the date of filing RHP with SEBI is awaited.

    Discuss this question

  16. 16. I have an ICICI 3-in-1 account and I hold SBI shares. Can I apply in SBI Cards IPO retail and shareholder quota using the same demat, bank account and PAN?

    Yes, you can apply in both categories of SBI Cards IPO using the same demat account, savings account and PAN number.

    If you are planning to apply in both categories, the maximum bid amount for the Retail and Shareholder category is up to ₹200,000 in each category.

    If you are only applying in the shareholder's category, there is a maximum limit of up to ₹200,000.

    ICICI Direct website will show 2 entries in the IPO list, one for shareholders and another for regular application. It will be like applying in 2 IPO's.

    Discuss this question

  17. 17. How do I apply in SBI Card IPO Shareholder quota using ASBA?

    The process is the same as it is with any other IPO you have applied in the past. You can use any bank's website (i.e. ICICI, HDFC, PNB, Axis, Kotak) to apply in SBI Card IPO online.

    Note: SBI Cards IPO will be available to apply online only when it's open for public bidding. The date of the IPO will be announced by the company a week before it opens.

    If you doing this first time follow these steps:

    1. Log in to your bank's website
    2. Register for IPO application facility
    3. Go to IPO section
    4. Select the SBI Card IPO (Shareholders) to apply.
    5. Enter IPO details like the number of lots, the bid price etc
    6. Verify and Confirm the details

    Discuss this question

  18. 18. Can SBI Life Insurance shareholders apply under the SBI Cards shareholder quota?

    No. Only Individuals and HUFs who are the public equity shareholders of SBI (State Bank of India) or Promoter of SBI Cards, can apply in shareholder quota.

    You have to at least 1 share of State Bank of India before the RHP of SBI Cards IPO filed to be eligible to apply under shareholders reservation category.

    Discuss this question

  19. 19. Can I use the same ASBA account for RII and Shareholder category for SBI Cards IPO?

    Yes, you can use the same ASBA account for applying in RII (Retail Individual Investors) and shareholders category in SBI Cards IPO.

    If you planning to apply in both, the maximum bid amount for Retail Individual Bidders and Shareholder Reservation categories is up to ₹200,000 in each category.

    If you applying only in the shareholder's category, you can apply for maximum bid amount up to ₹200,000.

    Discuss this question

  20. 20. Can I sell my share allocated in the shareholder's category on the day of listing in SBI Cards IPO?

    Yes, you can sell the shares allocated under the shareholder's quota on the day of SBI Cards IPO Listing. There is no lock-in period.

    Discuss this question

  21. 21. Are there any limitations on the shares bought through the shareholder's quota in SBI Card IPO?

    No, there are no restrictions on SBI Cards IPO shares allocated under the shareholder's category. There is no lock-in period or any time frame to hold the shares before you can sell them. You could sell them on the listing day similar to shares allocated in the general retail category.

    Discuss this question

  22. 22. How many shares are reserved for SBI shareholders in SBI Card IPO?

    SBI Card IPO has 13,052,680 Equity Share reserved for State Bank of India (SBI) shareholders. Approximate 10% of the total issue size is reserved for shareholders. The date of filing RHP is the cut-off date for shareholders.

    • Shares offer to Employees: 13,052,680 Equity Share (~10%)
    • Total Shares Offered: Rs 500 Cr (Fresh Issue) + 130,526,798 (OFS)

    Discuss this question

  23. 23. How many SBI shares required in the demat account to be eligible for SBI Cards IPO Shareholders Quota?

    Minimum 1 share of State Bank of India is required to be eligible for applying IPO application in the SBI Card IPO Shareholders category. The share should be in your demat account on the day of filing of SBI Card IPO Red Herring Document (RHP) which is yet to be announced.

    Discuss this question

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8 Comments

Saurabh
8. Saurabh  Jan 23, 2020 18:48 I Like It. | I Don't Like It. | Report Abuse Reply
I have demat account with Kotak bank but till date not puchase any SBI share.what can I puchase SBI card ipo.
Rekha Rawat
8.1. Rekha Rawat  Jan 24, 2020 10:54 I Like It. | I Don't Like It. | Report Abuse
Yes. You can purchase SBI Cards IPO share under RII category.
Kishor Somwanshi
7. Kishor Somwanshi  Jan 16, 2020 09:05 I Like It. | I Don't Like It. | Report Abuse Reply
I'm a new investor and would like to know how to apply for this IPO. I have already purchased one SBI SHARE to be in the share holder category. I have my DMAT Account with Angel Broking
Team Chittorgarh.com
7.1. Team Chittorgarh.com  Jan 18, 2020 11:10 I Like It. | I Don't Like It. | Report Abuse
Hi Mr Kishor,

1. Please wait for SBI Cards IPO dates to be announced.

2. When IPO shares is open for bidding, contact Angel Broking to understand how to apply in this IPO.

Note: The process is online and very simple.
Manish
6. Manish  Jan 12, 2020 16:44 I Like It. | I Don't Like It. | Report Abuse Reply
I am a bit confused, Can I apply above 2 lakhs in shareholders category? If No then is there any way to apply with amount above 2 lakhs.
Team Chittorgarh.com
6.1. Team Chittorgarh.com  Jan 18, 2020 11:07 I Like It. | I Don't Like It. | Report Abuse
If you are interested in applying in both shareholders and retail categories, you are eligible for a maximum limit of ₹200,000 in each category (A total of ₹4L).

If you are only applying in the shareholder's category, you can apply for as much as you want.

As per DRHP
"An SBI Shareholders bidding in the SBI Shareholders Reservation Portion above ₹200,000 cannot Bid in the Net Offer (retail category) as such Bids will be treated as multiple Bids."
RadhakrishnA
5. RadhakrishnA  Dec 22, 2019 09:21 I Like It. | I Don't Like It. | Report Abuse Reply
In HDFC AMC shareholder quota, cutoff date was date of DHRP. So for SBI card which is cutoff date for share holder quota, date of DHRP or RHP?
Team Chittorgarh.com
5.1. Team Chittorgarh.com  Jan 18, 2020 11:00 I Like It. | I Don't Like It. | Report Abuse
In case of SBI Card IPO, the cut-off date is date of filing RHP. The SBI Card DRHP Says

"Only SBI Shareholders (i.e. individuals and HUFs who are equity shareholders of SBI (excluding such other persons not eligible under applicable laws, rules, regulations and guidelines) as at the date of the Red Herring Prospectus) would be eligible to apply in this Offer under the SBI Shareholders Reservation Portion."
sumit kumar sharma
4. sumit kumar sharma  Dec 19, 2019 21:21 I Like It. | I Don't Like It. | Report Abuse Reply
Dear Admin, please clarify if SH will oversubscribed then the allotment will be as minimum lot (i.e. 24 shares) or on proportionate basis. If the allotment will be on proportionate basis then there is no any benefit to take one shares in all accounts we can apply from one account for RII.
Team Chittorgarh.com
4.1. Team Chittorgarh.com  Jan 18, 2020 10:58 I Like It. | I Don't Like It. | Report Abuse
Dear Mr Sumit,
As per DRHP "If the aggregate demand in this category (shareholders) is greater than 13,052,680 Equity Shares at or above the Offer Price, the allocation shall be made on a proportionate basis."

We recommend investors to apply in all possible ways to make the maximum profits.
Kishor
3. Kishor  Dec 16, 2019 08:47 I Like It. | I Don't Like It. | Report Abuse Reply
Can we still buy 1 Share of SBI as of 16th December and apply SBI Card IPO in shareholder category? When RHP was filed?
Team Chittorgarh.com
3.1. Team Chittorgarh.com  Jan 18, 2020 10:56 I Like It. | I Don't Like It. | Report Abuse
Hi Mr Kishor, The RHP has not yet filed. You still have time to but 1 share of SBI to become eligible for application in shareholders category.
Texas kanaiyalal vadwala
2. Texas kanaiyalal vadwala  Dec 12, 2019 18:14 I Like It. | I Don't Like It. | Report Abuse Reply
As I am shareholder I would like to apply in shareholder and retail both quota.I want to know how can apply in both quota as thrugh bank of India
online and mannally. May I applied twice as shareholder and retail saperat
NITIN
1. NITIN  Dec 10, 2019 15:52 I Like It. | I Don't Like It. | Report Abuse Reply
can we apply retail & share both catagory five different demate account with different pan through sbi netbanking
Team Chittorgarh.com
9.1. Team Chittorgarh.com  Dec 11, 2019 09:24 I Like It. | I Don't Like It. | Report Abuse
Dear Mr Nitin,

We are still awaiting response from SBI on this.

Their current system permits 5 IPO applications from 1 bank account.




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