CDSC IPO Allotment System in Nepal: Lottery Probability & Rules
Initial Public Offerings (IPOs) in Nepal attract millions of retail applicants through the central C-ASBA and MeroShare portals. Under Securities Board of Nepal (SEBON) guidelines, public shares follow a strict 10-kitta minimum allotment policy, ensuring democratic distribution before larger blocks are assigned.
- SEBON mandates 10 kitta as the minimum allotment block for individual retail applicants.
- When an IPO is oversubscribed, all valid applicants enter a computer-generated random lottery.
- Applying for more than 10 kitta in oversubscribed issues locks surplus funds without increasing lottery odds.
- Reserved quotas allocate 10% of total IPO shares to Nepali citizens working in foreign employment abroad.
Understanding the 10-Kitta Lottery Probability
When total applicant demand exceeds available shares, allotment follows pure proportional chance:
| Public Issue Shares | Total Valid Applicants | Allottees (10 Kitta each) | Lottery Success Odds |
|---|---|---|---|
| 10,00,000 Kitta | 15,00,000 Applicants | 1,00,000 Applicants | 1 in 15 (Approx. 6.67%) |
| 20,00,000 Kitta | 14,00,000 Applicants | 2,00,000 Applicants | 1 in 7 (Approx. 14.28%) |
| 50,00,000 Kitta | 15,00,000 Applicants | 5,00,000 Applicants | 1 in 3 (Approx. 33.33%) |
| 1,50,00,000 Kitta | 15,00,000 Applicants | 15,00,000 Applicants | 100% Guaranteed Allotment |
Foreign Employment Migrant Quota Rules
The Government of Nepal mandates that 10% of every general public IPO be reserved exclusively for verified remittance workers holding active labor permits. Because candidate pools in this category are smaller, lottery success probabilities are significantly higher than the general retail public.
Final Thoughts
Understanding subscription mechanics prevents unnecessary capital locks in bank accounts. Check your issue probabilities and expected returns using our IPO Allotment Calculator.
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