Government today raised Rs 2,218 crore from sale of 15 per cent stake in construction company NBCC, with its offer for sale getting over-subscribed.
With NBCC disinvestment, the government has raised Rs 8,632 crore through OFS and buyback of equities so far in the current fiscal. The government has budgeted to raise Rs 56,500 crore through disinvestment this year.
The offer for sale (OFS) for 9 crore shares over two-days fetched total bids for 11.35 crore shares.
"The sixth CPSE disinvestment of the Fiscal Year 2016-17 took place on October 20 and 21, 2016 with the National Building Construction Corporation (NBCC) OFS getting oversubscribed 1.54 times in non-retail category (yesterday) and 1.50 times in retail category," an official statement said.
As much as 7.2 crore shares were reserved for institutional bidders while 1.8 crore were earmarked for retail investors.
Retail investors put in a bid for 1.4 crore shares or nearly 82 per cent of the quota reserved for them. Another 1.2 crore bids came from non-retail bidders on day-two of the OFS which took the total subscription for the day to 1.5 times of 1.8 crore shares on offer, according to stock exchange data.
"The retail investors bid today for 20 per cent of the (OFS) portion reserved for them, i.E., 1.8 crore equity shares of the company amounting to Rs 443.70 crore at floor price. They had the option to place a price bid or opt for bidding at cut off price," the statement said.
The new arrangement provides retail investors the benefit of discovering the cut off price of the first day of OFS and placing their bids on second day on a more informed basis than was the case earlier.
Retail investors, who have been defined as ones placing bids for shares of total value of not more than Rs 2 lakh, will also be entitled to a 5 per cent discount.
With this disinvestment, government's share in NBCC will come down to 75 per cent.
"At the end of the day with total subscription of Rs 3098 crore against Rs 2,218 crore (at floor price), the NBCC OFS stood oversubscribed by 1.4 times," the statement said.
The highlight of the issue has been the encouraging FII participation of Rs 369.21 crore, which works out to be 21 per cent of the non-retail basket.
As many as 9 crore shares in the state-owned construction company were offered over two days at a floor price of Rs 246.50. Institutional investors had yesterday bid for 11.08 crore as against 7.2 crore reserved for them.
Retail investors, for whom bidding opened today, put in bids for 1.4 crore, or 81.8 per cent of 1.8 crore shares reserved for them, according to stock exchange data.
As per the terms of the OFS, any unsubscribed portion of retail segment can be allocated to excess bids by institutional investors.
In the secondary market, the stock of NBCC slipped near 4 per cent to Rs 241.30.
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