Overwhelming response: MUL share may be priced Rs 122-125

New Delhi: The overwhelming response for the Maruti Udyog's (MUL) initial public offer (IPO) has resulted in the inter-ministerial group (IMG) deciding to recommend a cut-off price in the range of Rs 122-125 for a Rs 5 share against the floor price of Rs 115 set by the Indian government.

Along with this, the IMG has also decided to suggest that the government should exercise the 10-per cent green-shoe option while at the same time reserving a higher proportion of the issue for retail investors by setting aside up to 32 per cent of the IPO for the small investors who have applied for more than 1,000 shares instead of the earlier limit of 25 per cent.

The total proceeds for the government based on the indicative cut-off price will be in the range of Rs 950-1,000 crore.

The IMG is believed to have recommended a higher allocation of shares to retail investors in order to broad-base the shareholding in the joint venture carmaker which has a share of more than 50 per cent of India's car market. Japanese Suzuki Motor Corporation holds a majority stake of 54.2 per cent in MUL.