The government’s sale of its 5 per cent shareholding in India’s largest steelmaker SAIL was oversubscribed mid-way on the first day of its opening on Thursday. Over 26.01 crore shares were sought by 1400 hrs on Thursday the first day of the two-day offer for sale (OFS), stock exchange data showed. The shares sought were 125 per cent of the overall issue size and nearly 144 per cent of the shares reserved for non-retail investors who were supposed to make bids on an opening day.
The government is selling 20.65 crore shares or 5 per cent of the total equity of Steel Authority of India Limited (SAIL) through the OFS. It has an option to sell an additional 20.65 crore share of SAIL in case of oversubscription. The overall divestment, firm plus greenshoe, will total 10 per cent. A floor price of Rs 64 per share was set for the OFS. The OFS for non-retail investors opens on Thursday. Retail investors can bid on Friday.
Of the 20.65 crore shares on offer, 18.07 crore have been reserved for non-retail investors and 2.58 crore for retail investors.
The indicative price of bids that came in on Thursday was Rs 64.66, exchange data showed.
At least 12.5 per cent of the offer shares will be reserved for the allocation to retail investors.
No single bidder other than mutual funds registered with the Securities and Exchange Board of India (Sebi) will be allocated over 25 per cent of the shares on offer, according to the terms of OFS. A minimum of 25 per cent of shares will be reserved for mutual funds and insurance companies. At the floor price, the sale of 41.3 crore shares (firm plus greenshoe) will fetch the government over Rs 2,600 crore.
The SAIL OFS is part of the government’s disinvestment program through which it is targeting to raise a record Rs 2.1 lakh crore in the current fiscal ending March 31, 2021.