With Medibank Private (ASX: MBL) shares due to hit the ASX boards at noon today the prospect of instantaneous profits will be on the mind of many retail investors. But the big question is how much of your application will you actually receive?
The wild popularity of the IPO has resulted in a significant scale-back to applications over $7,000. Retail investors can expect to be allocated shares on the following basis
| General Public Offer Applicants who did not pre-register who applied for | Receive |
| $2,000 | The full amount you have applied for |
| $2,001 to $7,000 | $2,000 + 75.00% of your Application within this band |
| $7,001 to $14,000 | $5,750 + 20.00% of your Application within this band |
| Over $14,000 | $7,150 + 5.00% of your Application within this band |
| General Public Offer Applicants who pre-registered who applied for | Receive |
| $2,000 to $2,300 | The full amount you have applied for |
| $2,301 to $7,000 | $2,300 + 86.25% of your Application within this band |
| $7,001 to $14,000 | $6,353.75 + 23.00% of your Application within this band |
| Over $14,000 | $7,963.75 + 5.75% of your Application within this band |
| Policyholder Offer Applicants who did not pre-register who applied for | Receive |
| $2,000 to $2,300 | The full amount you have applied for |
| $2,301 to $7,000 | $2,300 + 86.25% of your Application within this band |
| $7,001 to $14,000 | $6,353.75 + 23.00% of your Application within this band |
| Over $14,000 | $7,963.75 + 5.75% of your Application within this band |
| Policyholder Offer Applicants who pre-registered who applied for | Receive |
| $2,000 to $2,600 | The full amount you have applied for |
| $2,601 to $7,000 | $2,600 + 97.50% of your Application within this band |
| $7,001 to $14,000 | $6,890 + 26.00% of your Application within this band |
| Over $14,000 | $8,710 + 6.50% of your Application within this band |
As can be seen most applicants who applied for an amount up to $7,000 can expect to receive almost all of what they applied for. However, there's a significant scale-back in effect for amounts over $7,000 and $14,000.
For example a non-policy holder who did not pre-register and applied for $50,000 worth of shares in the hope of a big stag profit may be disappointed to know their application will be capped at $7,150 plus 5% of the amount applied for over $14,000, which would be an additional $1,800.
However, at $2 per share retail investors are still getting a 7% discount to the $2.15 price being paid by institutions and with intense demand for the stock it wouldn't be a surprise if it climbed in early trade. This potentially could give retain investors the opportunity to lock in 10-20% profits once the stock is listed.
