Oil India maiden issue by October

Oil India (OIL) is gearing up for its maiden share issue to the public, with the petroleum ministry asking the company to be ready to go to the market by mid-October.

"We are preparing for the public offer, which the petroleum ministry has said will be sometime around mid-October. We are in the process of appointing lead managers for the issue," a senior OIL official said.

However, even as the company prepares to raise money from the market, there is still no clear directive on how much stake will be offered to the public.

Initially the plan was to expand the company's capital base by 10 per cent and offer 10 per cent of the expanded capital to the public and 1 per cent to the employees.

The petroleum ministry is now considering piggybacking on the company's share sale by divesting 10 per cent of its own stake as well. Petroleum Minister Murli Deora had recently said that the ministry was in talks with the Left parties to reach a final decision on the divestment.

"The 10 per cent disinvestment looks to be almost certain. However, there is no directive yet from the ministry about expanding the capital base by 10 per cent," the official said.

With the Sensex hitting its all-time high and analysts expecting the market to remain strong, the official said that it was a good time to go to the market.

"We hope to raise around Rs 1,500 crore at current prices. The market is on an upswing and we are bullish on the public offer," the official said.