The government will offload a 5.36% stake in state-run Rail Vikas Nigam Ltd (RVNL) through the offer-for-sale (OFS) route, which includes a green shoe option of 1.96%, a top official said.
“Offer-for-sale in RVNL opens tomorrow for non-retail investors. Retail investors can bid on Friday,” Department of Investment and Public Asset Management (DIPAM) secretary Tuhin Kanta Pandey said in a tweet. The floor price for the offer is fixed at Rs 119 per equity share at a discount to the closing price of Rs 134.35 apiece on the BSE on Wednesday. Even at the floor price, the offloading of the 5.36% stake would help the government mop up about Rs 1,330 crore. The government currently holds a 78.20% stake in the company.
The promoter proposes to sell up to 70,890,683 equity shares of the company, representing 3.40% of the total paid-up equity share, to non-retail investors on Thursday, according to an exchange filing. Additionally, it intends to sell 40,866,394 equity shares, representing a 1.96% stake, to retail investors and those non-retail ones who choose to carry forward their un-allotted bids. After the OFS, RVNL will meet the minimum 25% public shareholding norm set by the market regulator Sebi.
The government has budgeted Rs 51,000 crore in disinvestment revenue for the current fiscal year. In FY23, disinvestment proceeds hit `35,294 crore, compared with the target of Rs 50,000 crore, thanks to the move to postpone the OFS plan for Hindustan Zinc Ltd. However, the shortfall in disinvestment revenue was more than offset by larger-than-anticipated dividends by central public sector enterprises. RVNL recorded a net profit of Rs 34.5 crore for the March quarter, against Rs 37.2 crore a year before.
Source: Economic Times