Basis of Allocation/Basis of Allotment

When an issue closes, the received bids are grouped into categories such as firm allotment, Qualified Institutional Buyers (QIBs), Non-Institutional Buyers (NIBs), and Retail. The over subscription ratios are then calculated for each category, comparing the number of bids to the shares reserved for that category. Within each category, bids are further sorted into buckets based on the number of shares applied for. The over subscription ratio is then applied to determine the number of shares to be allotted for each bucket. The final step is to determine the number of successful allottees. This process is used for proportionate allotment, but for QIBs, the post issue lead manager has discretion in the allotment process.