Bidding is another method. There are variations. When the Philippine government privatized oil refiner Petron in 1994, it encouraged every Filipino to buy shares, but limited applications to one for each person. After vetting the applicants, the government made sure everyone got a piece of the IPO by setting the ceiling at 1,500 shares for each subscription. For all the pains Manila took, however, there were complaints that some people were able to buy more than what was allowed.
Public offerings can be an easy way for politicians and other influential people to reward allies.
The IPO was oversubscribed by 25 times. Regulators said the practice was technically not illegal, but told underwriters and issuers to avoid it. Knowing how the system works is an obvious first step in getting a share of the IPO bonanza. The best option is to be among the front-runners. For that, you have to do some legwork.