The initial public offering (IPO) of Life Insurance Corporation of India (LIC) will remain open for investors on Sunday, May 8. Considering the huge interest from the subscribers, the authorities made an exception for India’s biggest initial public offering so far. Investors put their bids for LIC IPO on Saturday, May 7 as well. Usually, bidding for IPOs is not available during the weekend.
SBI Branches to Remain Open on Sunday for LIC IPO
The State Bank of India (SBI) earlier mentioned that all of its branches will remain open on Sunday, May 8 to take LIC IPO applications. “We are happy to inform that, for the convenience of our customers applying for LIC IPO, all our branches will be open on 8th May 2022 (Sunday) to accept application,” SBI wrote on their official Twitter account.
RBI Asks ASBA-Designated Bank Branches to Open on May 8
The Reserve Bank of India also directed all Application Supported by Blocked Account (ASBA) designated bank branches to remain open on Sunday. “The Government of India, in order to facilitate bidding for LIC IPO, has requested that all bank branches designated to process ASBA (Application Supported by Blocked Amount) applications may be kept open for public on May 8, 2022 (Sunday). The matter has been examined and it has been decided that banks may keep all their ASBA designated branches open on May 8, 2022 (Sunday) for the above purpose,” the RBI said in a circular.
LIC IPO Booking: What is ASBA? How does it Work?
ASBA is the mechanism through which investors apply for shares in a public issue by their bank account. Simply put, ASBA is an application that contains an authorisation from investors to block the application money in the bank account, for subscribing to an issue. It is mandatory for the investors to apply through ASBA in public issues and rights issues. It must be noted that if a subscriber is applying through ASBA, his or her application money shall be debited from the bank account only if his/her application is selected for allotment after the basis of allotment is finalised. “Technically one can apply IPO any day till window is open through ASBA, the processing takes place next working day,” said Narendra Solanki, head- equity research (fundamental), Anand Rathi Shares & Stock Brokers.
LIC IPO: Bank Unions Object to Banks Working On Sunday
All India Bank Officers’ Confederation (AIBOC) has objected to RBI decision to open ASBA-designated branches on Sunday to facilitate subscription to the public offer of Life Insurance Corporation. “Considering extensive usage of online subscription of initial public offer (IPO) among the investors, we are of the considered view that most of the branches will not get even a single application on Sunday in the physical format. In such circumstances, the decision to keep open all the bank branches is per se farcical and banks cannot afford to bear such humongous expenditure,” AIBOC said in a statement. The decision will not yield any result rather impose huge financial burden which is estimated to be more than ₹ 100 crore on account of employee compensation and other operational costs to keep the branches open on a holiday, it said.