Led by LIC, institutional investors bid for twice the number of shares offered by government for 5 per cent stake sale in logistics firm Concor, guaranteeing the exchequer Rs 1,165 crore.
In a flying start to the 2-day offer for sale (OFS), institutional buyers put in bids worth Rs 1,887 crore, as against the total issue size of Rs 1,165 crore.
Bids poured in for 1.57 crore shares or 2.02 times the 77.98 lakh shares offered to institutional investors on day one, as per the NSE data.
Retail investors, for whom 20 per cent of the issue size of 97,48,710 shares has been reserved, will get to bid tomorrow.
At floor price of Rs 1,195 a share, the government is targeting Rs 1,165 crore from sale of its 5 per cent stake in Concor. Any unsubscribed portion of retail investor would be allocated to institutional buyers, and going by the bids that poured in today the government is guaranteed a full sell off.
"Markets were very choppy both today and yesterday but still we got subscription of over 2 times. There was wide participation from all segments of institutional buyers," Disinvestment Secretary Neeraj K Gupta said.
While foreign institutional investors bids for 40 per cent, insurance companies, both LIC and private insurers, bid for 125 per cent of the shares on offer.
Mutual funds bid for 30 per cent of the shares, which banks bid for just 1 per cent.
As many as 19.49 lakh shares have been reserved for retail investors, who will be allocated shares at a discount of 5 per cent to the cut-off price. Retail investors are individuals who place bids for shares of total value of not more than Rs 2 lakh.
"We expect a good response from retail investors tomorrow," Gupta said.
Shares of Concor closed at Rs 1,195.55, down 2.54 per cent over previous close on the BSE.
Pursuant to the stake sale, government stake in Concor will come down to 56.80 per cent.
Indicative price offered was Rs 1,196.20 as against the floor or minimum price of Rs 1,195 apiece. The sale of 97.48 crore shares at this floor price will fetch about Rs 1,165 crore to the exchequer.
Concor is the 7th PSU stake sale of the current fiscal and will help the government inch towards the revised disinvestment target of Rs 25,000 crore.
The Container Corporation of India (Concor) falls under the administrative control of the Railway Ministry and provides logistics support such as inland container depots, domestic container terminals, transportation by rail and road, warehousing, storage and other value-added solutions.
The government has already raised Rs 18,352 crore through stake sale in IOC, NTPC, EIL, PFC, REC and Dredging Corp.
The government has lowered the disinvestment target for the current fiscal to Rs 25,000 crore in the revised estimates, from the budgeted Rs 41,000 crore.
