Coal India OFS Oversubscribed by 417%:
The Centre’s offer for sale (OFS) of shares in Coal India received a significant response from both non-retail or institutional investors and retail investors on Friday. The two-day OFS saw the government selling its 18.48 crore shares, representing a 3% stake in Coal India. Prior to the sale, the union ministry of coal had informed the exchanges that the floor price for OFS would be set at ₹225 per share, resulting in an overall offer size of over ₹4,100 crore.
Retail investors displayed considerable interest, submitting bids for over 2.58 crore shares of Coal India on Friday. Similarly, institutional bidders expressed their confidence in the company, placing bids for 5.12 crore shares. Notably, institutional investors had already submitted bids for over 28.76 crore shares on Thursday.
The initial offer comprised of up to 9,24,40,924 equity shares, representing a 1.5% stake, with an additional equivalent amount of shares offered due to oversubscription. This oversubscription indicates the high demand among investors.
The coal ministry’s letter to the exchanges stated that up to 5% of the total offer may be allocated to employees. Each employee will be allotted up to 2,00,000 shares, and in the event of undersubscription in the employee portion, the maximum allotment per employee will not exceed 5,00,000 shares.
The Coal India OFS marks the first government stake sale of a public sector undertaking in the current fiscal year. Currently, the government holds a 66.13% stake in CIL. The proceeds from this stake sale will contribute to the government’s disinvestment target of ₹51,000 crore for the current fiscal year.
In conclusion, the strong response to the Centre’s OFS of Coal India shares reflects the positive investor sentiment and the company’s perceived value. This sale will not only help the government achieve its disinvestment target but also contribute to the overall growth and development of the coal sector in India.
About Coal India:
Coal India Limited is a central public sector undertaking in India, owned by the Ministry of Coal, Government of India. Its headquarters are located in Kolkata. It holds the distinction of being the world’s largest government-owned coal producer. With approximately 272,000 employees, it is also the seventh-largest employer in India.
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