The Indian Railway Catering and Tourism Corporation (IRCTC) will launch its IPO on September 30 and has set the price band at Rs 315-320 per share. The government intends to raise Rs 635.04 - 645.12 crore from the offering, but the company will not receive any proceeds as it is an offer for sale issue. Following the IPO, the government's stake in IRCTC will come down by 12.5 per cent.
The IRCTC offer comprises of an offer for sale of 2 crore equity shares of face value Rs 10, representing 12.5% of total paid-up equity. The floor price and cap price are 31.5 times and 32 times the face value of the equity shares respectively. There will also be additional employee reservation portion of 1.6 lakh shares, taking the total offer size to 12.6 percent of total paid-up equity.
Of the total shares on offer, 50% will be available for allocation to qualified institutional buyers (QIBs), including 2 lakh equity shares for the mutual fund portion on a proportionate basis. In addition, not less than 15% of the offer will be available to non-institutional investor category and at least 35 per cent will be made available to the retail category.
IRCTC's stake sale is a part of Modi government's full year divestment programme. The government has budgeted to raise Rs 90,000 crore by way of CPSE disinvestment in the current fiscal, up from Rs 85,000 crore in FY19.
IDBI Capital Markets & Securities Limited, SBI Capital Markets Limited and Yes Securities (India) Limited are the book running lead managers to the IRCTC IPO.
IRCTC was incorporated on September 27, 1999 as a public limited company and was conferred a mini-Ratna status by government on May 1, 2008. IRCTC has diversified into non-railway catering services like e-catering, executive lounges and budget hotels.
Edited By: Udit Verma
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