Royal Mail Shares

savethepound

Dunno if anybody has posted this, but be aware that you might get far less of your money invested than you expect. According to BBC business editor Robert Peston today, applications for the shares are a "few times" the value of those on offer. http://www.bbc.co.uk/news/business-24395691

Guardian also says it is rumoured to be heavily oversubscribed:

"Veteran City commentator David Buik of Panmure Gordon confirms that the Royal Mail flotation is a hit:

Finally Panmure Gordon keep hearing good vibes about next Tuesday’s close of the Royal Mail’s IPO.
It appears to be heavily oversubscribed with a few hedge funds reputed to have subscribed for hundreds of millions of shares. Expectations are that Goldman will price the issue at the top end of the range at 330p due to heavy demand. Early indications are that trading will start in the 375-380p range. Trading starts next Friday 11th October 2013. "

http://www.theguardian.com/business/2013/oct/04/us-shutdown-deadlock-hits-stock-markets-live

If so, it seems likely that we will get shares on a pro-rata basis as the allocation method, though maybe it will be more complicated.
http://www.iii.co.uk/royalmail-IPO-information

So we might only get, say, 30% or 50% of what we applied for, and be refunded the rest. An example of this kind of thing happening:
http://www.redmayne.co.uk/sharedealing/ipoNewsFlow.htm?ipoID=106

Rollinghome

savethepound wrote: »

If so, it seems likely that we will get shares on a pro-rata basis as the allocation method, though maybe it will be more complicated.
http://www.iii.co.uk/royalmail-IPO-information

So we might only get, say, 30% or 50% of what we applied for, and be refunded the rest. An example of this kind of thing happening:
http://www.redmayne.co.uk/sharedealing/ipoNewsFlow.htm?ipoID=106

It could be done on a pro-rata basis but allocations for previous heavily subscribed privatisations have usually been on a sliding scale rather than strictly pro-rata. So those who asked for a small number of shares got them in full with those asking for larger allocations being heavily scaled back.

When some of the electricity companies were privatised those asking for just a couple of hundred shares got them in full while those who asked for a large number got none. Shrewd politicians prefer to be seen as being fair to the small investor.

Mr_K

savethepound wrote: »

So we might only get, say, 30% or 50% of what we applied for, and be refunded the rest. An example of this kind of thing happening:
http://www.redmayne.co.uk/sharedealing/ipoNewsFlow.htm?ipoID=106

Bet those that bought Esure are now glad it was scaled back. Started off at 290p, now its 234p....

racing_blue

Mr_K wrote: »

Bet those that bought Esure are now glad it was scaled back. Started off at 290p, now its 234p....

Climbed to 333.9p in July though.
Pump n dump anybody?

androidpower

Am I allowed to apply for the IPO from more than 1 stockbroker?

Old_Slaphead

Or is it allowed to apply via a Sipp and an Isa held with separate providers?

Vortigern

androidpower wrote: »

Am I allowed to apply for the IPO from more than 1 stockbroker?

No, it's not allowed. But how will the vendors detect multiple applications? When will they be detected? - and what action would be taken on discovery?

Old_Slaphead wrote: »

Or is it allowed to apply via a Sipp and an Isa held with separate providers?

HL will allow you buy some in their ISA and some in their SIPP. I don't know if it would be possible to do this via separate providers.

Amarone

Hi

Newbie here. I am looking to buy around £1000 of Royal Mail shares. I have no experience whatsoever but will give my take on things and await advice.

I have looked at an intermediary such as X-O as they only charge £5.95 to deal and there are no charges to hold. I see this as a long term investment and the start of building a portfolio and investing in other areas once I am more informed. I note when applying online they send you a pin by post which won't be in time to buy shares by next Tuesday. For those of you who have bought via X-O is this correct or can you buy immediately once acount is opened online?

I bank with First Direct and notice they have a shares account with decent charges eg £11 per trade no costs to hold or inactivity, so comparable to X-O nearly. They are not however one of the intermediaries mentioned in dealing on the RM website. I may go with First Direct in the long run but don't want to miss out on the deal so may just buy through the RM.gov website into their nominee account then look to transferring once I have taken my time to set up an online share account? (£10 charge to transfer).

I am a 40% tax payer so need to look at an ISA long term but charges appear high? I may buy in my wife's name.

Thanks for any advice.

MonkeyD

The pin would be for dealing in the shares that you bought, it is not necessary for the completion of your application for the RM share. So you apply for you £1000's worth, same day they should be sending your pin first class. Comes trading day you find out how many shares you've been allocated and use your pin to stag, but seeing as you're looking at this as a long term investment you should not worry about the pin not arriving quickly.

gt94sss2

Amarone wrote: »

I bank with First Direct and notice they have a shares account with decent charges eg £11 per trade no costs to hold or inactivity, so comparable to X-O nearly. They are not however one of the intermediaries mentioned in dealing on the RM website. I may go with First Direct in the long run but don't want to miss out on the deal so may just buy through the RM.gov website into their nominee account then look to transferring once I have taken my time to set up an online share account?

If you want to move your shares to First Direct you are better off buying online directly and choosing the option for them to send you a share certificate - which you can then send to First Direct (for free) - rather than opting for the RM nominee account

Regards
Sunil