The offer for sale of India’s biggest power producer NTPC was subscribed 1.4 times by the non-retail investors on the first day of bidding. The government is selling 5% of the holding or 41.22 crore shares at a floor price of Rs 168 per share. The government would garner Rs 7,000 crore by selling 5% stake through the two-day OFS, with an option to retain a similar portion in case of over-subscription.
Institutional investors had placed bids for 46.35 crore shares on the first day as against the total of 32.98 crore shares reserved for them. The two-day OFS was opened for institutional investors on Tuesday and retail investors would get to bid on Wednesday. About 8.24 crore shares have been reserved for retail investors, who will be offered a 5% discount.
The government owns 69.74% stake in NTPC as on June 30, 2017. Shares of NTPC declined 2.8% to Rs 168.50 on Tuesday. The government has targeted to raise Rs 72,500 crore in 2017-18 through stake sale in PSUs. This includes Rs 46,500 crore from minority stake sale, Rs 15,000 crore from strategic disinvestment and Rs 11,000 crore from a listing of PSU insurance companies.
So far in the current fiscal, the government has raised over Rs 8,800 crore through disinvestment in six companies, including selling a stake in L&T through Specified Undertaking of Unit Trust of India (SUUTI) and a share buyback. Read more