BACHELOR OF BUSINESS ADMINISTRATION

Detailed explanation-1: -Oversubscription is referred to as the situation where a company receives more applications from share buyers than the number of shares made available for the public.

Detailed explanation-2: -A company receives applications for more shares than what is offered to the public for subscription. This situation is termed as Over Subscription of shares. However, allotment can be only made to the number of shares that have been issued.

Detailed explanation-3: -When the subscription received for the shares by the company, is more than the shares offered, then the situation of oversubscription arises. On the other hand, when the company receives lesser applications than the total number of shares offered to the general public, the issue is said to be undersubscribed.

Detailed explanation-4: -Oversubscribed refers to an issue of stock shares in which the demand exceeds the available supply. An oversubscribed IPO indicates that investors are eager to buy the company’s shares, leading to a higher price and/or more shares offered for sale.

Detailed explanation-5: -Solved Example For You: The company receives applications for 285000 shares. This is a case of oversubscription. It deals with them in the following manner: Applicants for 25000 shares receive a full allotment.