Government stake sale in Engineers India commenced on the bourses today, with 10 per cent of the issue getting subscribed in initial hours even as the stock fell 1.5 per cent in early morning trade.
The floor or minimum offer price has been set at Rs 189, which is at a discount of 2.4 per cent to the yesterday's closing price of Rs 194.05 on BSE.
The government is looking to raise about Rs 637 crore from sale of 3.36 crore shares in EIL through a one-day OFS route at a floor or minimum price of Rs 189 apiece.
The issue of 3.36 crore shares has received total bids for over 33.19 lakh shares, or 10 per cent, of the issue size till 1035 hours, as per stock exchange data.
This is the fifth disinvestment this fiscal. The government had in August last sold a minority stake in IOC.
The sale, which began at 0915 hours, received subscription from retail investors, who are also getting 5 per cent price discount. As against 67.38 lakh shares reserved for them, bids for over 8.10 lakh came in at 1035 hours, stock exchange data showed.
However, institutional investor response has been dull so far as they bid for over 25.09 lakh shares as against over 2.69 crore shares reserved for them. The subscription may rise further during the day as bidding will continue till 1530 hours.
The EIL stock fell 1.51 per cent over the previous close to Rs 191.10 in early trade on BSE.
The government currently holds 69.37 per cent in EIL, a public sector company under the Ministry of Petroleum and Natural Gas. It provides engineering and construction consultancy, particularly in the hydrocarbon space.
The government has so far raised only Rs 12,700 crore through PSU disinvestments in the current fiscal against the budgeted target of Rs 69,500 crore.
Of the target set in February last year, Rs 41,000 crore was to come from minority stake sale in PSUs and another Rs 28,500 crore from strategic stake sale.
