Cancelling an IPO through ASBA: A Step-by-Step Guide

If you have applied for an Initial Public Offering (IPO) through the Application Supported by Blocked Amount (ASBA) process and now wish to cancel your application, follow these detailed steps to ensure a smooth process.

Understanding ASBA and IPO Cancellation

An ASBA application is a method where investors can apply for an IPO without the need to pay the full amount upfront. Instead, a blocked amount is maintained in the bank. If your application is successful, the blocked amount will be released to the issuing company. However, you have the option to cancel your application if you change your mind. This guide will walk you through the cancellation process.

Steps to Cancel an ASBA Application

Visit the Bank

The first step in cancelling your ASBA application is to visit the bank or financial institution where you originally submitted your application. Only the bank has the authority to process the cancellation.

Provide Details

When you visit the bank, you will need to provide the following details about your application:

Application Number: This is a unique identifier assigned to your application by the bank. Demat Account Number: This is associated with your stock trading account. Name of the IPO: Specify the name of the company you are bidding for. Bid Quantity: The amount of shares you were planning to apply for.

Fill Out the Cancellation Form

Most banks will have a cancellation form that you need to fill out. Ensure that all the details you provide are accurate and complete to avoid any issues during the cancellation process.

Submit the Form

Once you have filled out the cancellation form, submit it to the bank along with any required identification or documentation.

Confirmation

After processing your request, the bank will confirm the cancellation of your IPO application. Additionally, the blocked amount will be released back to your account.

Important Points to Consider

Cancellation Deadline

It is crucial to cancel your application before the IPO close date. Cancellations are typically not accepted once the IPO has ended.

Multiple Applications

If you have applied through multiple banks, you will need to cancel each application separately. This ensures that each of your applications is properly terminated.

Broker App Cancellation Option

Once your mandate ASBA is successful, you can cancel the application from the broker app before the IPO closes for subscription. However, once the IPO closes, you cannot cancel it from the broker app.

To cancel the application, go to the trading application or website and visit the window through which you have applied for the IPO. There should be an option to cancel the application. Follow the prompts to complete the cancellation process.

Specific banks like SBI have specific timelines for cancellation through their internet banking. For SBI, you can cancel up to 2 PM on the closing day through internet banking. For other times, you must visit the bank officials, who can cancel the ASBA application up to 5 PM.

IRFC IPO Update

If you wish to cancel your application for the IRFC IPO, follow the timelines mentioned by SBI. Note that IRFC IPO’s retail subscription is at 3.66x times, which means 1 out of every 4 applications is likely to get an allotment. Therefore, even if you cancel your application, you still have a 75% chance of not getting an allotment. Be cautious when deciding to apply for an IPO that may list with a loss as it may indicate that the risk is high.

Conclusion

By following the above steps, you can successfully cancel an ASBA application for an IPO. It is essential to act promptly and reach out to your bank or broker if you encounter any issues during the cancellation process.