State-owned National Buildings Construction Co’s (NBCC) initial public offering (IPO) may be launched on March 22, Sidhartha Pradhan, additional secretary in the government’s Department of Disinvestment, told a television channel on Wednesday.
The government plans to sell a 10 per cent stake in NBCC, which is a consultant for civil construction and real estate projects.
The share sale will be the government's first since a $2.6 billion auction in Oil and Natural Gas Corp earlier this month failed to attract enough investors, forcing state-run Life Insurance Corp to pick up most of the five percent stake on offer.
While pricing details for the issue are yet to be worked out, the IPO is expected to raise between Rs 200 crore and Rs 250 crore, a source with direct knowledge of the matter said. Enam and IDBI Capital are the merchant bankers to the issue.
The share sale is part of the government's plan to raise Rs 40,000 crore in the current financial year through stake sales in state-run firms, to trim a yawning fiscal deficit. So far, the government has raised about $2.8 billion, in two share sales.
Stake sales in Bharat Heavy Electricals, Oil India and Steel Authority of India Ltd could be considered in the financial year that starts in April, Pradhan said.
The NBCC disinvestment will be the last public offering by the government in the current financial year. MOIL was the last IPO from the government stable, which came in November 2010.
NBCC had filed a draft red herring prospectus (DRHP) on February 9. The company’s issue will have a discount of five per cent for retail investors.
“We have delivered profits constantly for four to five years, our net worth has improved over the years and we have delivered projects within schedule,” NBCC chairman and managing director Vishnu P Das told reporters in Mumbai last month.
NBCC has an order book of Rs 10,622 crore. It has land parcels in Patna, Kochi and Gurgaon among others plans to launch the projects for sale in the coming months.
