ASBA forms to be made available on websites of the stock exchanges

SEBI vide circular CIR/CFD/DIL/7/2010 dated July 13, 2010 has stated that ASBA bid-cum application forms would be made available for download and printing, on websites of the stock exchanges which provide electronic interface for ASBA facility (i.e. BSE and NSE). The ASBA forms so downloaded would have a unique application number and can be used for making ASBA applications in public issues. The ASBA forms should be made availble on stock exchange's websites at least one day before opening of the public issue. This rule is applicable to all public issues opening on or after July 19, 2010. This move from SEBI would ensure wider availability of ASBA forms in addition to the ASBA forms available at the designated branches. It would also improve the popularity of the ASBA facility among the retail investors.

Review of the progress in implementation of ASBA facility

A memorandum circulated in the SEBI board meeting dated May 19, 2010 contains the following facts in relation to the progress of implementation of ASBA facility.

•  ASBA was introduced on July 30, 2008 wherein only ‘Retail Individual Investors’ could make applications in book built public issues by blocking the bid amount in their bank account subject to condition that bidding be done only at ‘cut-off’ price with no revision facility ("Phase–I"). Subsequently, on August 20, 2009, ASBA was made mandatory for rights issue.
• During Phase I, ASBA facility was used in about 23 public issues and 19 rights issues and ASBA applications as a percentage of total applications from retail individual investors category ranged from less than 1% to 28%.
• Later ASBA facility was extended to other investor categories also like Non Institutional Investors (NIIs) which include High Networth Individuals (HNIs), Corporate entities etc. The extension of ASBA facility ("Phase-II") involved changes in system software, procedure etc., and became effective from January 1, 2010 for all the public issues (book built and fixed price) and right issues.
• As on April 15, 2010, 27 banks having 3535 designated branches have certified their readiness for Phase II.
• Since January 1, 2010, ASBA facility was used in 24 public issues and 10 rights issues wherein the ASBA applications as percentage of total applications were in the range of 6.5% to 28% out of which applications by NIIs was in the range of less than 1% to 16%. 

More (previous) posts on ASBA are available here, here, here, here and here.