The Hindu Business Line : Investors baffled by allotment largesse

ALLOTMENT mistakes, which had surfaced over the recent public issues of ONGC and Bank of Maharashtra, do not seem like isolated incidents after all. The recent equity issues of GAIL (India) and Power Trading Corporation (PTC) were also marked by such goof-ups.

Incidentally, as in the cases of the ONGC and Bank of Maharashtra, the registrar to the GAIL offer was also MCS Ltd.

The Securities and Exchange Board of India is understood to be probing the investor complaints of mis-allotments of ONGC and Bank of Maharshtra shares.

However, unlike in the case of ONGC and Bank of Maharashtra, the allotment-related problem for GAIL, as per information available with Business Line, is that of over-allotment and excess payment, in fact double refunds.

Mrs Sonali Mohta, an investor residing in this city, had applied for 270 shares of GAIL and paid application money of Rs 49,950. She was allotted a total of 288 shares — 144 each in two different confirmation of allocation notes. The two confirmation notes carry two different numbers. She had also been refunded a total of Rs 43,548 in two cheques instead of Rs 23,274.

In the case of PTC, Business Line has come across instances of over-refund. Two Chennai-based investors have already informed MCS regarding such over-refunds. One of them, who had applied for 200 PTC shares, and whose application was rejected, got a refund of Rs 16,000 instead of Rs 8,000 paid upfront as application money. The other person was lucky to get allotment of 500 shares and also a full refund of money.

Attempts at contacting MCS and couple of its senior officials, to have their version, during the past fortnight did not yield results. However, merchant banking sources said that large number investors have been complaining about allotment related mistakes, which might have been caused by huge workload, unmatched by technical and physical infrastructure of the registrar.

The Bank of Maharashtra CMD, Mr S C Basu, however, said that the process of dematerialisation of the wrongly issued physical shares numbering about one lakh, were being carried out by MCS.