The allocation of shares in an IPO is typically handled by the underwriting investment banks. The banks will typically conduct a roadshow in which they present the company to potential investors, and based on their feedback, the banks will determine the demand for the stock and how it should be allocated.

The allocation process can be influenced by several factors, including:

Investor demand: The banks will allocate shares based on the level of demand from investors. Investors who have a track record of participating in IPOs may receive priority.

Size of the order: Investors who place larger orders may receive a larger allocation of shares.

Relationship with the investment bank: Investors who have a longstanding relationship with the investment bank may receive preferential treatment.

Investor type: Institutional investors, such as mutual funds and pension funds, may receive priority over retail investors.

Geographic location: The allocation of shares may also be influenced by the geographic location of the investor. For example, the company may want to allocate shares to investors in key markets where it operates.

It’s worth noting that the allocation process can be complex and is subject to regulatory oversight to ensure that it is fair and transparent.