ABC Limited, a public company, has come with public issue of 15,00,000 equity shares through a book building process. The price band is ₹500-₹600. The following table shows demand of securities at various price levels. W

Cut off price is the highest price at which demand for securities is fulfilled. Simply, it is the highest price at which all shares offered can be sold by the company. All those investors who have submitted their bid at price equal to or above the cut off price are known as successful bidder and they are entitled for the allotment of shares as per method prescribed in SEBI (ICDR) Regulation, 2018. In the given question, we calculate cut off price as under: Total number of Equity Shares for public issue: 15,00,000 Price Band: ₹500 - ₹600 Firstly, we have to arrange the demand for shares on the basis of price in descending order and cumulative demand has been calculated. S. No. Demand (Number of Shares) Cumulative Demand Bid Price (in ₹) 1. 7,00,000 7,00,000 600 2. 3,50,000 10,50,000 595 3. 1,40,000 11,90,000 590 4. 1,10,000 13,00,000 585 5. 2,00,000 15,00,000 575 6. 1,00,000 16,00,000 560 7. 4,00,000 20,00,000 545 8. 2,00,000 22,00,000 535 9. 4,00,000 26,00,000 530 10. 8,50,000 34,50,000 520 From the above table it is clear that the demand is fulfilled at a price of ₹575, so cut off price will be ₹575. Bids that are at or above the issue price only qualify for share allotment.