Coal India OFS: Non-retail portion subscribed 3.46x; retail investors can bid on Friday, says DIPAM Secy

The government's offer-for-sale (OFS) for up to 3 per cent stake in Coal India Ltd got over-subscribed by institutional investors on Thursday, said DIPAM Secretary Tuhin Kanta Pandey. The issue was subscribed 3.46 times of the base size, he said.

The government had offered over 8.31 crore shares to institutional investors on Thursday under the OFS, but received bids for 28.76 crore shares or 3.46 times. At the indicative price of Rs 226.12 a share, the bids of institutional buyers are worth Rs 6,500 crore.

In the two-day OFS, the government is selling over 18.48 crore shares, or 3 per cent stake, in the PSU coal producer at a floor price of Rs 225 a share. The sale includes a green-shoe option of 1.5 per cent in case of over subscription.

Bidding for retail investors will begin on Friday.

"Offer for Sale in CIL received enthusiastic response from non-retail investors today. The issue was subscribed 3.46 times of the base size. Govt has decided to exercise the green shoe option. Retail investors get to bid tomorrow," tweeted Department of Investment and Public Asset Management Secretary.

In the secondary market, shares of Coal India closed trading at Rs 230 apiece, down 4.66 per cent over Wednesday's closing price.

Coal India will be the first Public Sector Undertaking (PSU) stake sale in the current fiscal. If fully subscribed, a 3 per cent stake would fetch over Rs 4,000 crore for the government.

The floor price of Rs 225 was set at a 6.7 per cent discount over Wednesday's closing price of CIL. The government currently holds 66.13 per cent in CIL.

Stake sale in Coal India will help the government inch towards the Rs 51,000-crore disinvestment target set for the current fiscal.