Investing in IPOs has gained massive popularity among retail and institutional investors. However, not everyone is lucky enough to get an allotment due to overwhelming demand. Here’s what happens to your blocked funds if you don’t receive an IPO allotment.
Three of these IPOs – DAM Capital Advisors, Transrail Lighting IPO, Mamata Machinery IPO have experienced a huge demand as well as some issues were being called out by investors who found difficulty or technical glitch in getting or checking allotment.
When Will the Funds Be Unblocked?
When applying for an IPO, the amount is blocked in your bank account through the ASBA (Application Supported by Blocked Amount) process. If you are not allotted shares, the blocked funds are unblocked and made available in your account. Here’s the timeline:
- Refund Initiation Date: The refund process typically begins the day after the basis of allotment is finalized.
- For the Current IPOs:
- DAM Capital Advisors IPO: Refunds will begin on December 26, 2024.
- Transrail Lighting IPO: Refunds will begin on December 26, 2024.
- Mamata Machinery IPO: Refunds will begin on December 26, 2024.
How Is the Money Refunded?
- ASBA Method:
- The funds are released by the bank automatically.
- Once unblocked, the amount is immediately reflected in your bank account.
- UPI-Based Applications:
- If you applied through UPI, the mandate expires automatically if no shares are allotted.
- The blocked amount will then become available in your account.
How Long Does It Take?
- Typically, the refund process is completed within 24-48 hours of the refund initiation date.
- Factors such as banking holidays or internal processes of the bank may slightly delay the timeline.
How Will You Be Notified?
- Bank SMS/Email:
- Banks notify users when funds are unblocked.
- Keep an eye out for SMS or email communication from your bank.
- Registrar Updates:
- You can track your refund status through the registrar’s official website. For the ongoing IPOs, all three IPOs are handled by Link Intime:
- Visit the Link Intime website.
- Select the IPO name (e.g., DAM Capital Advisors, Transrail Lighting, or Mamata Machinery).
- Check your application status for refund updates.
- You can track your refund status through the registrar’s official website. For the ongoing IPOs, all three IPOs are handled by Link Intime:
Other Points to Note
- No Government or Regulatory Approvals Needed: The refund process is entirely automated and governed by SEBI regulations.
- Check Mandate Status: For UPI applications, monitor the mandate status in your UPI app to confirm whether funds have been released.
- What If Funds Are Delayed?: In rare cases of delays, contact your bank or the IPO registrar for assistance.
While not getting an allotment can be disappointing, the refund process is smooth and adheres to SEBI’s strict timelines. For the IPOs with high subscription rates like Mamata Machinery (194.95x), DAM Capital Advisors (81.88x), and Transrail Lighting (81.98x), refunds are expected to be processed promptly, ensuring your funds are available for future investments. Always keep an eye on your bank notifications and the registrar’s website for updates.
