 "Govt directs Sebi to beef up surveillance for Coal India OFS")
Ahead of the government’s mega share sale in Coal India via the Offer for Sale (OFS) it has directed the Securities and Exchange Board of India (Sebi) to beef up its surveillance to prevent any manipulation during the divestment.
The government on Wednesday announced a 10 per cent stake in Coal India, out of which 5 per cent is the green shoe option, which could fetch the government over Rs 22,000 crore.
It is the largest stake sale.
The very fact that the OFS starts on Friday, less than a couple of days after the government announced the stake sale at 5 pm on Wednesday, indicated that the authorities are not giving any time to stock brokers to hammer the Coal India share.
“We do not want a situation where there is any manipulation that could impact the share sale. Additionally we want retail investors to be a part of the divestment so there shouldn’t be any cornering of shares by operators,” said a source.
For the Coal India stake sale, the government has doubled to 20 per cent the quota reserved for retail investors, who can buy shares worth up to Rs 2 lakh in the share sale. They would also be given a 5 per cent discount to the bid price entered by them.
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The government on Thursday set the floor price of Coal India at Rs 358/share for an OFS in which it plans to sell 5 per cent stake in the firm. The share closed at Rs 374 on Thursday, implying a 4.5 per cent discount from the last closing price.
The stock exchanges in-line with the directions have already beefed up their surveillance for the stock, generally the case before any major share sale.
The market players anticipate the issue may be oversubscribed as there is enough appetite for the issue.