Wednesday, April 18, 2007

IPO Application

For new investors who kept on asking about IPO application, Here's some FAQ about IPO application source from MALAYSIAN ISSUING HOUSE SDN BHD.

i. IPO Timeline
Q : How long does it take an IPO to be listed after subscription opens?
A : The minimum time needed is 13 market days for an IPO where the retail public portion is less than 20 million shares, 16 market days where it is between 20 to 50 million shares and 18 market days where it is 50 million shares and above.

Q : Can an IPO timeline be longer than mentioned above?
A : Yes. The stipulated timeline is the minimum established. The IPO Issuer may choose to have a later listing. For example, subscriptions may open for more than the usual 5 market days, in which case the listing timeline will be longer.

ii. Share Application Forms

Q : Where can I obtain copies of share application forms?
A : Copies are available at the offices of most stockbrokers, merchant banks and selected banks. In addition, copies are also available at the office of the IPO Adviser (normally a merchant bank or universal broker) and at MIH (Basement 1, Menara Multi-Purpose, Capital Square, Jalan Munshi Abdullah, Kuala Lumpur). Application forms are also printed in major newspapers for Main Board IPOs.

Q : How else can I apply for shares if I can't find share application forms?
A : You may make use of Electronic Share Application if you are an account holder of one of seven participating banks (see Electronic Share Application FAQs for details) or an account holder with access to internet financial services facilities offered by an internet participating financial institution (see Internet Share Application FAQs for details).

Q : Must I have a CDS Account?
A : Yes. Your application will also be rejected if you fail to provide your correct CDS account number.

v. Electronic Share Application (ESA)
Q : Which banks offer ESA services?
A : The Participating Financial Institutions are AmBank Berhad, Bank Muamalat Malaysia Berhad, Bumiputra-Commerce Bank Berhad, HSBC Bank Malaysia Berhad, Malayan Banking Berhad, OCBC Bank (Malaysia) Berhad and Standard Chartered Bank Malaysia Berhad (at selected branches only).

: How do I qualify for the ESA facility?

A : You must have an account with a Participating Financial Institution and be issued with an ATM Card.

Q : I have not used the ESA facility before. Is it a difficult process?
A : No, doing an ESA transaction is a simple process. Just follow the step-by-step instructions on the ATM screen of your Participating Financial Institution.

Q : After completing my ESA transaction, the ATM will issue a transaction slip. Do I have to send the slip together with a share application form to MIH?
A : No. The transaction slip is for your retention as a personal record of your transaction. No share application forms are required for ESA.

Q : Is the ESA transaction slip the same as an ATM Statement obtained for IPO applications?
A : No. The ATM Statement is a mode of payment in lieu of a bank draft, and just like a bank draft, must be attached to a share application form for submission to MIH.

Q : If my ESA application was not successfully balloted, how do I get my refund?
A : MIH will inform your Participating Financial Institution that you have not been successful within 2 business days from balloting. Your Participating Financial Institution will credit your account within 2 business days after hearing from MIH.

vi. Internet Share Application (ISA)

: Which institutions offer ISA services?

A : CIMB Securities Sdn Bhd at , Malayan Banking Berhad at and RHB Bank Berhad at

vii. Status of Share Application and Refunds
Q : When will my share application be returned to me, if it is not successful during balloting?
A Your share application envelope A with your payment draft intact will be mailed to you within 1-2 days after balloting.

Q : How will I know whether my share application has been successful during balloting?
A : A notice of allotment of shares would be mailed to you prior to listing of the IPO.

Q : Are there any other ways I can find out whether my application is successful?
A : You can check the status of your application on this website (IPO Results Enquiry), call your stockbrokers to check your CDS account or call MIH Enquiry Services at 03-26932075 ( 10 lines) during normal office hours.

Q : Why is it my unsuccessful share application is sometimes returned to me later than 1-2 days after balloting?
A : Your application although not successful, could have been picked as a Reserve application during balloting and kept for a few more days in case it is needed to replace a successful application which is subsequently rejected. Being a Reserve application you still have a chance of being successful instead of being outright unsuccessful.

Q : Why do you need Reserve applications?
A : Reserve applications are needed to replace a certain percentage of successful applications which are found to contain errors pertaining to payment, CDS account numbers and other irregularities during processing.

Q : Why is it my payment draft is cleared and yet I am unsuccessful?
A : Although every endeavor would be made to avoid presenting an unsuccessful application draft for payment, this is sometimes unavoidable. An example would be when an application is initially successful, in which case the draft would be banked in and later an application error is detected e.g. wrong CDS account after verification by Bursa Malaysia Depository Sdn Bhd. For this reason, it is an IPO condition that no application shall be deemed successful by reason of the remittances having been presented for payment.


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