Question

what do you mean by pro-rata allotment of share ?​

Answer 1

Answer:

A company may receive applications for shares more than the number of shares it has offered to the public. This is known as over-subscription of shares. Usually, the companies that are financially strong, have a good reputation in the market or have profitable future prospects, receive over-subscription of shares. Thus, Pro Rata Allotment becomes necessary.

Explanation:

Pro rata is a Latin term used to describe a proportionate allocation. If something is given out to people on a pro rata basis, it means assigning an amount to one person according to their share of the whole.