Indian Oil's 10% stake sale raked in a total of Rs11,107 crore
25 August 2015
On a day when market melted, forcing the Bombay Stock Exchange benchmark Sensex down 1,624 points, investors pumped money into new stocks helping Indian Oil Corp's 10-per cent stake sale get subscription of up to Rs11,107 crore, or 143 per cent of the offer, in one day.
The offer for sale by Indian Oil Corporation Limited (IOCL) of 242.7 million shares, forming a 10-per cent stake in the company, was largely subscribed by the institutional investors with the institutional portion subscribed 143 per cent.
The retail portion, however, received subscription for only 18 per cent of the offer as the market turmoil deterred small investors.
At the end of the day with total subscription (including institutional and retail) of approximately Rs11,107 crore, the issue stood oversubscribed by 18 per cent.
This was the third central public sector enterprise (CPSE) disinvestment under the new Sebi Rules allowing the notice period to include banking day in addition to a trading day.
Overall, this was the fourth CPSE disinvestment for the fiscal year 2015-16, which was successfully completed today with the IOCL OFS getting fully subscribed.
On offer was 10 per cent paid-up capital of the company comprising 24,27,95,248 shares, of face value Rs10 each. Out of the shares offered for sale, 20 per cent was reserved for retail investors, ie, those investors who placed bids for shares of total value of not more than Rs2,00,000. In addition a five per cent discount was also offered to retail investors. With this disinvestment, the government of India shares in IOCL will come down to 58.57 per cent.
Retail investors, however, ended losers amidst Monday's market mayhem as they either overlooked or dumped the key divestment.