Royal Mail retail offer gets 700,000 applications Vince Cable said on Wednesday there had been 700,000 individual retail applications for Royal Mail shares - which were seven times oversubscribed - and was confident they had been "priced in the right place." Asked about the likely premium when the shares start trading on Friday, the business secretary said people should look beyond the immediate "froth" that will arise. "We are interested in getting a privatised institution over a period of years," he told the House of Commons select committee examining the sale. He added that broker Panmure Gordon's view that Royal Mail was worth £4.5bn was "way outside the estimates of most of the equity analysts." The level of applications is comparable with the 1984 flotation of British Telecom, which resulted in 750,000 small shareholders, though below the 1.5m shareholders British Gas acquired in 1986. Danny Cox, head of financial planning at retail stockbroker Hargreaves Lansdown, said: "Certainly, it shows that there's a very healthy appetite and keen interest in investing. This has the potential to reinvigorate the culture of investing in the UK. Stuart Welch, chief executive of TD Direct Investing, said 40 per cent of their applications came on Tuesday. It's captured the imagination because everybody is talking about it, saying how well it is going, and that the price will go up when trading starts. "90 per cent of our applications came from existing customers and 10 per cent have come from new customers," he said. The coalition is selling as much as 60 per cent of the company in the most ambitious privatisation since the railways in the 1990s. Institutional investors that placed orders for Royal Mail shares at less than 330p risked missing out amid strong demand, bankers for the sale warned. They told the market that the initial public offering was significantly oversubscribed and many institutional investors that applied for stock at a lower price may not get any allotment. Brokers said there had been "unprecedented" demand from private investors, who had until midnight to apply. Whitehall officials declined to confirm reports that institutions had placed orders for more than £30bn of shares. Such a figure had little meaning because institutions, realising demand was heavy, had ramped up orders in the hope of winning just a proportion of them, they said. Michael Fallon, business minister, sought to reassure retail investors that they would "get their fair share." Mr Fallon's remarks came amid fears that smaller buyers would be sidelined by City banks and hedge funds, which will get about 70 per cent of the shares being sold. The grey market price offered by IG Index, a spread betting group, fell back to 380p-400p after profit-taking, compared with 396p-416p on Monday. Only 368 of Royal Mail's 150,000 workers have declined the offer of free shares in the company. Additional reporting by Jonathan Eley and Vanessa Kortekaas