Royal Mail shares: How to buy at the last minute

Are you interested in buying Royal Mail shares? You have just 48 hours left. We explain what you need to do.

The deadline to buy shares is midnight tomorrow so postal applications are unlikely to be received in time.  

Time is running out to buy shares in Royal Mail. Here our last minute checklist guides you through your options.

Can I still buy shares by post?

The deadline to buy shares is midnight tomorrow so postal applications are unlikely to be received in time, even if you send an application pack by first-class post today. To avoid disappointment your best option at this stage is to apply online or by telephone through a broker. A number of brokers, including Hargreaves Lansdown and Interactive Investor, will be open to receive share applications until midnight tomorrow evening.

A list of brokers offering the shares, and their dealing costs, can be found here.

The minimum investment is £750 and there is, in theory, no maximum. However, If the share offer is oversubscribed investors may receive fewer shares than they hoped for. The Government has not ruled out a first-come, first-served cut-off, which would probably see anyone applying from today miss out.

Has demand for the shares been high?
Although it is difficult to gauge how popular the share sale has been before the offer closes, the indications are Royal Mail shares have been in high demand. A number of investment analyst believe the price of the shares, at between £2.60p and £3.30p each, is cheap. This has prompted a late surge in demand.
Analysts at Panmure Gordon said the company was worth up to £4.5 billion – well in excess of the current upper valuation of £3.3 billion. This could send the company straight into the FTSE 100 in December when its constituents are next reshuffled.
A minimum investment of £750 could result in an instant profit of around £300 after the float if analysts’ predictions are correct.
Is Royal Mail a ‘buy’?
The Daily Telegraph’s Questor column is impressed and rates the shares a buy. The temptation of an estimated income of around 7pc in a world of rock bottom interest rates gives the shares plenty of appeal. The estimated yield would leave it standing head and shoulders above high income favourites Centrica (4.5pc), Tesco (4pc) and SSE (5.7pc). We have also captured the pros and cons of Royal Mail shares here.
What happens after midnight on Tuesday?
The close of the share offer Tuesday will be followed by a three-day period of “conditional trading” when City institutions can buy and sell the shares between them.
The final price will be announced on Friday and shares in Royal Mail will be traded on the London Stock Exchange from Monday next week.