What is meant by pro-rata allotment of shares?
The method of allocating shares to the applicants on certain proportionate basis is known as pro-rata allotment of shares. It may be in case of over subscription of shares. Under this method, allotment is made to each applicant on a proportionate and smaller number of share allotted to each applicant as per the number of shares applied by him/her.It means all the applicants are not allotted in full on pro-rata basis. the excess application money received on application can be adjusted towards sum due on allotment and calls and further balance will be refunded.
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