00:00So today's topic is oversubscription of shares.
00:05The issue of shares is said to be oversubscribed when the number of shares applied are more
00:11than the number of shares issued for subscription.
00:14Suppose a company is issuing 50,000 shares or applications, they get 70,000.
00:21So this situation is known as the oversubscription of shares.
00:25In this case, a company has three alternatives in front of it.
00:29Number one, they can reject the access applications and refund their money.
00:35And number two, they can do the partial or proportionate allotment known as the pro-rata
00:40allotment.
00:41They can allot the shares proportionately.
00:44Suppose you are giving 5 shares to the person who applied for 7 shares.
00:48That is, in the ratio of 7 is to 5, you are issuing the shares.
00:54And number three, combination of both 1 and 2 alternatives.
Comments