PRAKS Ltd. is planning for an IPO of 200,000 shares, at a book-built price of ₹ 100 each, resulting in an IPO size of ₹ 200,00,000. As per the ICDR Regulations, the over-allotment component under the Green Shoe mechanism

PRAKS Ltd. is planning for an IPO of 200,000 shares, at a book-built price of ₹ 100 each, resulting in an IPO size of ₹ 200,00,000. As per the ICDR Regulations, the over-allotment component under the Green Shoe mechanism could be up to 15% of the IPO. Prior to the IPO, the stabilising agent would borrow such number of shares to the extent of the proposed Green Shoe shares from the pre-issue shareholders. These shares are then allotted to investors along with the IPO shares. The total shares issued in the IPO therefore stands at 230,000 shares. IPO proceeds received from the investors for the IPO shares, i.e. ₹ 200,00,000 being 200,000 shares at the rate of ₹ 100 each, are remitted to the Issuer Company, while the proceeds from the Green Shoe Shares are parked in a special escrow bank account, i.e. Green Shoe Escrow Account. During the price stabilization period, if the share price drops below ₹ 100, the stabilising agent would utilize the funds lying in the Green Shoe Escrow Account to buy these back shares from the open market. This gives rise to the following three situations, examine all situations given below with reference to the role of stabilising agent. (a) Where the stabilising agent manages to buyback all of the Green Shoe Shares, i.e., 30,000 shares;