1. Centre dials LIC to save Indian Oil stake sale

Centre dials LIC to save Indian Oil stake sale

Amid a crash in the stock market on Monday and the Sensex plummeting 1,624.51 points, Indian Oil Corporation’s offer for sale...

By: | Mumbai | Updated: August 25, 2015 1:27 AM
After Monday’s stake sale, the government’s tally from selling minority stake in public sector companies will stand at nearly Rs 13,000 crore against the FY16 target of Rs 69,500 crore.

After Monday’s stake sale, the government’s tally from selling minority stake in public sector companies will stand at nearly Rs 13,000 crore against the FY16 target of Rs 69,500 crore.

Amid a crash in the stock market on Monday and the Sensex plummeting 1,624.51 points, Indian Oil Corporation’s offer for sale (OFS) received a tepid response from foreign institutions and retail investors and was reportedly bailed out by Life Insurance Corporation (LIC). The government sold 10% of the equity capital of the oil refiner at a floor price of Rs 387 per share, mopping up more than Rs 11,000 crore, with the issue subscribed 1.18 times.

The state-owned life insurer is understood to have acquired a “substantial” portion in the Rs 9,500-crore IOC issue, estimated at Rs 4,500 crore, based on a provisional assessment of bids. A top LIC official confirmed the insurer’s participation without divulging the quantum of shares purchased. Some large public sector banks, domestic insurance companies and mutual funds also acquired shares in the offer, they confirmed to FE.

The disinvestment department said institutional bids came in for an amount of Rs 10,780.21 crore while retail interest totalled Rs 344 crore despite hugely adverse market conditions. “I don’t want to get into hypothetical situations. Calls are made to all investors, by us and by our merchant bankers, and to every actor,” Aradhana Johri, secretary, disinvestment, said.

After Monday’s stake sale, the government’s tally from selling minority stake in public sector companies will stand at nearly Rs 13,000 crore against the FY16 target of Rs 69,500 crore.

Gr11

Stock exchange data showed the non-retail book comprising institutional investors and high net-worth individuals bid for 27.85 crore shares against 19.42 crore shares on offer. The book was subscribed 1.43 times with a large portion of the bids coming from domestic institutional investors. The retail book was subscribed just 0.18 times.

As against 4.85 crore shares reserved for the category, retail investors bid for 88.87 lakh shares even as they were entitled to get a 5% discount to the bidding price, data showed.

IOC shares declined 4.11% or Rs 16.20 to settle at Rs 378.25 apiece, while stocks of other refiners and energy companies fell even more with some hitting 52-week lows. On Saturday, the government set the floor price for the IOC stake sale at Rs 387 per share, a 1.9% discount to Friday’s closing price of Rs 394.45. Post the stake sale the government’s holding will drop to 58.57%.

Gr13

IOC’s secondary market transaction was the fourth-largest OFS of all time. The Centre had raised Rs 22,557.63 crore by selling 10% in Coal India in January 2015. The central exchequer had earlier garnered Rs 12,749.50 crore from ONGC in March 2012 and Rs 11,457.54 crore from NTPC in February 2013.

The department of disinvestment (DoD) had appointed five merchant bankers — Citigroup, Deutsche, Nomura, JM Financial and Kotak Investment Banking — to manage the IOC stake sale.

IOC’s stake sale is the third PSU disinvestment after the rule changes by Securities and Exchange Board of India in June 2015. The capital markets regulator allowed companies to disclose their OFS plans two banking days in advance instead of two trading days before launching an OFS.

The change in rules was introduced to reduce the gap between the disclosure of the OFS and the actual share sale, and limit the scope for the speculators to beat down the share price of the disinvestment-bound PSUs.

Also, Monday’s stake sale in IOC will be the second in three years and the fifth sale by the government after it first divested stake in the state-owned refiner in FY1995 — the then largest disinvestment offering of Rs 1,000-odd crore.

In March 2014, state-owned ONGC and Oil India (OIL) picked up 5% each from the government for a total sum of Rs 5,341 crore. The disinvestment was completed in an off-market transaction as the ministry of petroleum and natural gas opposed the OFS, stating IOC’s share price prevailing at that time did not reflect the right valuation of the company.

The government has lined up stake sales in ONGC, NTPC, NMDC, BHEL, Bharat Electronics and OIL among others.

In addition, the DoD has also proposed to conduct a follow-on offer in CPSE ETF. Previous year, the government had set a target of Rs 63,425 crore which was revised down to Rs 36,925 crore, but managed to raise only Rs 24,277 crore, DoD data showed.

  1. H
    Harry Potter
    Sep 8, 2015 at 6:03 pm
    Thanks to Modi-Wave, steepest rise in LnT stock in last 5 years is from Rs 722 (Aug 30, 2013) to Rs 1745 (July 4, 2014) apiece, a big cushion (shock aborver) of nearly Rs 1000 per share. L&T top-bres were on selling spree, leading the pack Chairman Mr Naik sold his L&T shares (Rs 1200 apiece) worth 70 crores in 20 days - March 2014. Post Q1-2014 results L&T plunged by 8 %, biggest intraday decline since July 2009. Post Q2 results L&T share plummeted from high of 1673 to low of 1450 (17 Dec, 2014). Post Q3 - 2014 results another big intra-day fall of 7.44 per cent. Post Q1 – 2015 stumbled by 5 per cent in early hours trade, Q1 profit tanked 27 per cent. Average of lows of last 12 years (Jan to Dec, 2004 till 2012) is Rs 622. Average of highs of last 12 years (Jan to Dec, 2004 till 2012) is Rs 1124. Average of lows of last 12 years (Sep 4 as reference day) is Rs 900. G Average of above three numbers is Rs 882 apiece. Some inherent malignancies in businesses – Hydrocarbon and Ship Building losses of Rs 900 cr each, Hyderabad Metro cost overruns Rs 4k crores, Rs5k crores stagnating investment in Defence. Aging CXO-MD potion of septuagenarians, leading the pack 72 yrs old Junior Engineer turned Executive Chairman Mr Naik completed 50 yrs. Where should we expect LnT stack post Q2-2015 results, 5 year low of 386? State owned LIC/UTI are biggest stakeholders at LnT. PM Mr Modi, should intervene to fix retirement age at LnT from SCANDALOUS 75 to 60 - ASAP!!--------------------------------------------------------------------------What are codes of conduct and standards of corporate governance, code of ethics? Any CXO/MD level official ever got fired (or behind bars) in last 10 years - What happened in this case - any logical conclusion, any culpability established? Please refer TOI article – "whistleblower was right: CBI". Excerpts – "CBI confirmed slain National Highway project engineer Satyendra Dubey's allegation --illegally sub-contracted the multi-crore works awarded to them in the Golden Quadrilateral Project -- M/s L&T had misrepresented the facts". BS Article – "Rajya Sabha nods for whistle blowers bill" – excerpts – "Prasad r To quote Mr Naik "there is no bloody owner at L&T". Its not just Mr Naik L&T is personal fiefdom of a old-men club, it is divided between septuagenarians vertical wise. CEO Mr Vekataramanan responsible for Hydrocarbon business and its heavy losses. Mr Masgapu is responsible for stagnating IT business L&T Infotech and L&T Tech services, Mr Deosthali is CEO of L&T Finance holding, Mr MV Kotwal man in charge of L&T's defence forays. All these gentleman are nearly or above 70.---------------------------------------------------------------------------------------------------------------------At LnT, the top-bres (schizophrenic Egyptian Mummies) have displa geriatric trait of biting more than they can chew and digest. Dear Investors/Analysts - Watch Out! LnT top-bres were on selling spree, leading the pack Chairman Mr Naik sold his LnT shares (Rs 1200 apiece) worth 70 crores in 20 days - March 2014. Post Q1-2014 results LnT plunged by 8 %, biggest intraday decline since July 2009. Hydrocarbon subsidiary suffered losses of 900 crores, sans stake at Dhamra Port (2500 crores) LnT would have posted losses. Modi /Market euphoria saved LnT going below Rs 1300 during q2, a striking closed range of 1200 of March 2014. Part stakes at LnT Inra sold to Canadian FII - (2000 crores), expecting VGF (Viability Gap Funding) of 3000 crores Hyderabad Metro project. Stake or post losses, Deep Sea or devil? Post Q2 results LnT share plummeted from high of 1673 to low of 1450 (17 Dec, 2014). Post Q3 results another big intra-day fall of 7.44 percent. LnT top bres should not be allowed to sell their LnT stock for at least next 8 quarter. -------------------------------------------------------------------------Thanks to Modi-Wave, steepest rise in LnT stock in last 5 years is from Rs 722 (Aug 30, 2013) to Rs 1745 (July 4, 2014) apiece, a big cushion (shock aborver) of nearly Rs 1000 per share. L&T top-bres were on selling spree, leading the pack Chairman Mr Naik sold his L&T shares (Rs 1200 apiece) worth 70 crores in 20 days - March 2014. Post Q1-2014 results L&T plunged by 8 %, biggest intraday decline since July 2009. Post Q2 results L&T share plummeted from high of 1673 to low of 1450 (17 Dec, 2014). Post Q3 - 2014 results another big intra-day fall of 7.44 per cent. Post Q1 – 2015 stumbled by 5 per cent in early hours trade, Q1 profit tanked 27 per cent. Average of lows of last 12 years (Jan to Dec, 2004 till 2012) is Rs 622. Average of highs of last 12 years (Jan to Dec, 2004 till 2012) is Rs 1124. Average of lows of last 12 years (Sep 4 as reference day) is Rs 900. G Average of above three numbers is Rs 882 apiece. Some inherent malignancies in businesses – Hydrocarbon and Ship Building losses of Rs 900 cr each, Hyderabad Metro cost overruns Rs 4k crores, Rs5k crores stagnating investment in Defence. Aging CXO-MD potion of septuagenarians, leading the pack 72 yrs old Junior Engineer turned Executive Chairman Mr Naik completed 50 yrs. Where should we expect LnT stack post Q2-2015 results, 5 year low of 386? State owned LIC/UTI are biggest stakeholders at LnT. PM Mr Modi, should intervene to fix retirement age at LnT from SCANDALOUS 75 to 60 - ASAP!!--------------------------------------------Biggest shareholders at LnT are state owned LIC/UTI. To restore Insutional Integrity at LnT, PM Mr Modi should intervene to fix retirement age at LnT to 60, sooner rather than later, ASAP!.Biggest shareholders at LnT are state owned LIC/UTI. PM Mr Modi please fix retirement age at LnT to 60. How come retirement age at LnT is whopping 75? Its SCANDALOUS!! ------------------------------------------------------------------------------------Like BCCI, LnT is no less cozy club, an Old-Men club enjoying Fire Proof jobs and stratospheric compensation. Expensive CXO Maha Kumbh Mela at LnT - what is the number of CEOs at LnT and all its subsidiaries (138), their CTC? How far higher, this is to manage LnT group revenues of $14 bln than Mr Sikka (aged 46) of Infosys highest paid professional CEO (Rs 30 cr) in India, entrusted with business worth $ 8 bln in revenues. At LnT, just Chairman Mr Naik (aged 72) and group CEO Mr Vankatramanan are pegged at 21 and 14 crores. Information Age leaders, top-man of TATA group, Infosys, Microsoft are in their 40s, why this super 70s at LnT? Chairman Mr Naik's jaw-dropping musings on succession – QUOTE- You find a man in the world who will kill himself four times a day, has worked for more than a hundred years-- There is no such person.-- None of us here (at senior level) are working for money -UNQUOTE. Please refer ToI article – Vibrant Gujarat summit Day 1: 25 private jets bring high-flyers. Excerpts – Cabinet ministers arrived via scheduled flights -- private jet of AM Naik left immediately after arriving –. Mr Naik should learn to walk the talk if he cannot set example he can follow the one set by Mr Murthy, Mr Murthy worked for a token ry of INR 1 during his second stint at Infosys, very company that he founded. How about donating all his earnings stock and barrel here is one example of not working for money - Vyakarnam Anjenaya Sastry, 71, had joined Infosys in 1990, donated half of his holdings to the Infosys Employee Welfare Trust while leaving the company in 1996. If he had held on to the shares, they would have been worth about Rs 1,850 crore (1% of Infosys). Mr Naik please walk the talk! Mr Naik says that in new economy he would have given a line of successors, okay than what Mr Magapu and Mr Deosthali are doing at L&T Finance and L&T Infotech, L&T Tech services, why not a leader in his/her 40s?---------------------------Its a Catch-22 situation young insiders are not good enough for the top jobs at LnT and its subsidiaries, outsiders (laterals) cant with stand Despotic Gritocracy the old-men club. Top-men-eater Egyptian Mummies. Infotech ex-CEO Mr Banerji, two current joint CEOs Mr Chopra and Dr Aghi – QUIT. Mr Ravi Uppal CEO LnT Power (Mr Naik's potential successor)–QUIT. CEO LnT General Insurance Mr Joydeep Roy – QUIT. CEO LnT MF Mr Sanjay Sinha – QUIT. Old-men club is singing this bad chorus and opera a distorted version remix of Brayan Adams songs - 18 till I die and Summer off 69 - oh ya!. The band joined LnT some time in 60s. This public sponsored deafening cacophony and distortion should be stopped. -----------------------------------------------------------------------------Biggest shareholders at LnT are state owned LIC/UTI. To restore Insutional Integrity at LnT, PM Mr Modi (first PM, born post independence) should intervene to fix retirement age at LnT to 60 – ASAP!!--------------------------------------------------------------GOI should intervene to stem the rot at LnT. Geriatric top-bres (Egyptian Mummies) at LnT have displa uncanny geriatric knack biting more than they can chew and digest. They have implemented major international hydrocarbon projects at losses; some sort of international CSR. Please allow me to give you all a glimpse (trailer) of a public sponsored circus - Gymnastics by 70 ton Gorillas and not-ready-to-extinct Dinosaurs at LnT. Please refer BS articles - LnT: International orders worth Rs 30,000 cr at risk - and - why analysts are angry with LnT. Some excerpts – 900 crores losses at hydrocarbon, 900 crores losses at Ship Bulding, 16,000 crores of Hydrabad Metro at doldrums. LnT calls hydrocarbon mishap an error of judgment, as it underestimated risks and overestimated its own capability. Some exotic and despotic nonsense by geriatric in chief - why Mr Naik is slogging at 72 to find successor - - you find a man in the world who will kill himself four times a day, has worked for more than a hundred years;-- There is no such person-. On one hand Executive Chairman Mr. Naik and top-bres (Egyptian Mummies) are taking their compensation and retirement to the highest level possible peaks of 75 years and 21 crores, forget about hundreds of crores in stocks, on other hand FIRING young talented employees - Please GOOGLE ---Cl Action Suit Seeks $100 Million for Pregnancy Discrimination, Other Violations-.Can employees, investors, analyst TRUST these dinosaurs? All 60 leave! Got slapped with ban by World Bank – please refer ET article – -World Bank bars LnT for 6 months over forgery-. LIC/UTI GOI should intervene to Save LnT, fix retirement age to 60 NOW!,
    Reply

    Go to Top