it is an option of allocating shares in excess of the shares included in the public issue

Under green shoe option underwriters are allowed to sell up to 15% additional shares than the original issued shares.When an issue is oversubscribed then this option can be undertaken to bring stability to the price of a security. Over subscription means there is more demand than supply for the underline security and this mismatch can result in the huge fluctuations to the price of security post listing and in order to bring the confidence and stability to the price additional issued shares are under Green shoe option are supplied in to the market.

A provision contained in an underwriting agreement that gives the underwriter the right to sell investors more shares than originally planned by the issuer. This would normally be done if the demand for a security issue proves higher than expected. Legally referred to as an over-allotment option.

i totally agree with Abhishek.

Under green shoe option underwriters are allowed to sell up to 15% additional shares than the original issued shares.When an issue is oversubscribed then this option can be undertaken to bring stability to the price of a security. Over subscription means there is more demand than supply for the underline security and this mismatch can result in the huge fluctuations to the price of security post listing and in order to bring the confidence and stability to the price additional issued shares are under Green shoe option are supplied in to the market.

i agree with abhishek

It's the option of allocating shares in excess of the shares icluded in public issue!