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Coal India declines on weak response to govt's stake sale

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Capital Market
Last Updated : Jan 30 2015 | 6:03 PM IST

Coal India fell 3.33% to Rs 362.65 at 11:45 IST on BSE as the divestment of up to 10% government stake in the state-run firm through the stock exchanges mechanism saw muted response so far.

Meanwhile, the S&P BSE Sensex was down 381.04 points or 1.28% at 29,303.23.

On BSE, so far 6.63 lakh shares were traded in the counter as against average daily volume of 2.5 lakh shares in the past one quarter.

The stock hit a high of Rs 364 and a low of Rs 360.50 so far during the day. The stock had hit a record high of Rs 423.85 on 11 June 2014. The stock had hit a 52-week low of Rs 240.50 on 26 February 2014.

The stock had underperformed the market over the past one month till 29 January 2015, falling 2.87% compared with Sensex's 8.34% rise. The scrip had also underperformed the market in past one quarter, gaining 4.81% as against Sensex's 9.53% rise.

The large-cap coal producer has equity capital of Rs 6316.36 crore. Face value per share is Rs 10.

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As per data on NSE as at 11:15 IST, bids were received for a total of 1.86 crore shares amounting to 5.88% of the base issue size for divestment of the government's 5% stake in the state-run coal major. The sale commenced today, 30 January 2015 at 9:15 IST and shall close at 15:30 IST.

The government has set the floor price for its offer for sale (OFS) of shares at Rs 358 per share. The floor price for OFS was set at a discount of 4.57% to closing price of Rs 375.15 yesterday, 29 January 2015. The announcement of floor price for OFS was made after market hours yesterday, 29 January 2015. The government on 28 January 2015, announced divestment of its stake in the company. The government has offered to sell 31.58 crore equity shares, or 5% equity, of face value of Rs 10 each with an option to sell an additional upto 31.58 crore equity shares, or 5% equity, of face value of Rs 10 each of Coal India, collectively aggregating to 10% of the total paid up equity share capital of Coal India through a sale on the separate window provided by the stock exchanges for this purpose.

The government has reserved 20% of the size of the sale for retail investors. Retail investors will be offered a discount of 5% to the bid price entered by them in accordance with the Sebi OFS circulars. A minimum of 25% of the sale shares will be reserved for mutual funds and insurance companies.

Coal India's consolidated net profit fell 28.2% to Rs 2192.38 crore on 0.6% rise in total income to Rs 17704.93 crore in Q2 September 2014 over Q2 September 2013.

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First Published: Jan 30 2015 | 11:44 AM IST

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