This comes straight from my experience... I applied for the IPO of
GMR Infrastructure in the first week of August through an
icicidirect.com demat account.
The IPO section in the account page listed GMR Infrastructure Limited. I clicked the Go button against the company and it took me to another page to enter the quantity and price that i wanted. These details were entered. There were two options for the payment,
Partial Payment and
Full Payment. This was my first venture into the share market. I was also not familiar with the options available in icicidirect.com account. I selected the Partial Payment option
assuming that the rest of the amount for the order would be automatically debited from my account when the allocation is done. I don't know what i was thinking at that time, i did not even bother to call their customer service to verify the implications of the Partial Payment option. I submitted the request and my order book showed that my request was in the Ordered status.
I checked a few days later and found that my order status was now Executed. Now came the date when the shares were being allocated. I was allocated the full amount of shares that i had requested for. But icicidirect.com wouldn't let me move them to my trading account so that i can sell them on the day of listing[that was my plan]. I was worried. So i called up their customer care and they told me that since i had not paid the full amount for my purchase, i would not be able to trade these shares until i pay the rest of the amount. They also informed that the company would contact me directly with instructions on how to pay the rest of the amount.
The day of the listing came. Still i didn't get any letter. Days went by and i was sure that my first investment would end up in loss[experts were of the opinion that GMR was a good holding only in the long term. that meant atleast 4-6 years]. Finally on the fifth day after the listing i got the letter. It stated that i had to take an 'Account payee' Demand Draft against a company account specified in the letter and submit it along with the letter to a particular bank branch, also listed in the letter. I took the DD today. Now i have to submit it tomorrow.
The letter also has this,
"Partly paid-up Equity Shares will not be traded until the Balance Amount Payable is received and corporate action for crediting Fully paid-up Equity Shares in your demat account is completed and trading approval in respect thereof is received from the Stock Exchanges. The process of corporate action may take about 2 weeks from the Due Date for Payment of Balance Amount or receipt of payment, whichever is later. During this period, these Partly paid-up Equity Shares cannot be traded." too bad.. :-( i can only sell my shares after a whole month from the date of listing... hope i won't end up in loss.
This all happened because i
assumed something and that went wrong. So its always better to clarify things if the stakes are high.
The Partial Payment option is good for an IPO which is expected to be oversubscribed[that too by a good amount] and you are not sure of getting all the shares that you have requested. Always pay the full amount if you are not sure.
Better safe than sorry !!!
PS: The standard disclaimer applies
