When it comes to allocating the shares to the public, then there is a set procedure that must be followed for the purpose of allocating the shares. It is extremely important that the steps or the procedure with regard to the shares allotment must be followed in the right manner. Here are some of the prominent steps that must be followed:
Procedure of the Share Allotment
There is a set procedure that has to be followed for the purpose of the allotment of the shares, which are as follows:
- Allotment through the proper resolution: This is a very first point that must be taken into the consideration for the proper allotment of the shares. It is extremely important that the allotment of the shares must only be made after the resolution by the board of directors of the company. If the board members of the company do not give their consent, then it may become a difficult or challenging task to issue the shares for the purpose of making an allotment.
- Allotment must be made in time: It is highly important that the allotment must be made on a proper time period, otherwise the allotment may get lapse.
- Allotment application must be communicated: The application of the allotment must be communicated to the interested applicant on time. The letter that has to be sent to the investors must contain the stamped letter of the allotment, time, date and place where the allotment will actually take place.
- Allotment must be made unconditionally: The allotment to the applicants must be made according to the terms and conditions mentioned by the company in the application.
Hence, it is imperative that you must be aware about the process of the share allotment. This will ensure that you know about the prominent steps that are undertaken by the company to allot the shares. There is no doubt at all that the company sends the letter to the applicants but what if the letter does not reaches you. In such a situation, one can make an effective usage of the technology and make use of the best stock market app to ensure that they get updates about the market anytime. The technology has made it quite a simpler task to remain knowledgeable and invest wisely.