The Rs 1,350 crore offer for sale (OFS)  of Rail Vikas Nigam Ltd (RVNL) received good investor interest and has proven successful in making the company Minimum Public Shareholding (MPS) compliant, the Secretary of the Department of Investment and Public Asset Management (DIPAM) said. 

Against a base offer to dilute 3.4% and a green-shoe option of an additional 4.08 crore shares or 1.96% stake, the government received bids of about 4.2% for nearly Rs 1,032 crore. The floor price for the two-day OFS was Rs 119.

The non-retail part of the offer for institutional investors opened on Thursday with bids worth over Rs 2,000 crore for 17.44 crore shares against a total issue size of 11.17 crore. 

On Thursday, institutional investors had put in bids worth over Rs 2,000 crore and the portion reserved for them was subscribed 2.73 times.

However, the retail part, which opened on Friday, only received bids for 2 lakh shares or 18% of the shares earmarked for them and hence was undersubscribed. Their unallocated portion was allocated to non-retail investors.

Post the OFS, the government’s holding in RVNL reached 72.84% from 78.20%, below the Securities and Exchange Board of India (SEBI) MPS holding mark of 75%.

The public shareholding in RVNL would rise to a little over 27% from 21.8%, meeting the market regulator’s MPS norm of 25% for listed firms. 

After the OFS, the government will also sell a 0.5% stake in the company to eligible employees. This would fetch another Rs 126 crore to the Centre.

The government’s full-year budget target from disinvestment is Rs 51,000 crore, with current receipts at about Rs 5,585 crore or 11% of the FY24 target.