1. EIL floor price at Rs 189 per share for 10% stake sale

EIL floor price at Rs 189 per share for 10% stake sale

Calculations based on the floor price suggest that the government will raise close to Rs 637 crore through the OFS.

By: | Mumbai | Published: January 29, 2016 1:03 AM

The government has fixed a floor price of Rs 189 per share for Engineers India’s (EIL’s) offer for sale (OFS), the company said in stock exchange filing.

Through the public offering the government plans to offload 10% of its stake in the Navratna public sector undertaking (PSU). The government has tendered more than 3.36 crore shares for the stake sale.

Calculations based on the floor price suggest that the government will raise close to Rs 637 crore through the OFS. Of the total shares in offering, a little more than 67 lakh shares have been reserved for the retail investors.

As on 31 December, the government held 69.3% stake in EIL.

SBICap Securities, ICICI Securities, Edelweiss Securities and Deutsche Equities India are the book running managers for the stake sale.

Shares of EIL declined 5.53% on Thursday after the government announced its OFS plan. Shares of the company closed at Rs 194.05 apiece on BSE.

A total of 17.4 lakh shares of EIL changed hands across the exchanges on Thursday – a three-fold increase compared to the 90-day average volume of 6.5 lakhs shares, Bloomberg data showed.

Amid volatile markets, EIL’s shares have declined 21% since the beginning of calendar 2016.

This stake sale is a part of the government’s push to meet its FY16 disinvestment target.

The government has raised only Rs 12,700 crore through PSU disinvestments in the current fiscal so far against the budgeted target of Rs 69,500 crore.

As per FY16 budget outline, Rs 41,000 crore is expected from minority stake sale in PSUs and another Rs 28,500 crore from strategic stake sale.

  1. No Comments.

Go to Top