Centre plans to sell 15% stake in Rail Vikas Nigam via offer for sale

By: |
October 21, 2020 10:55 AM

The Centre holds 87.84% of the equity in the company after disinvesting 12.16% through the public issue in April 2019.

The company, which was created as an arm of railways with the twin objectives of raising extra-budgetary resources and implementation of projects, posted a net profit of Rs 790 crore in FY20.The company, which was created as an arm of railways with the twin objectives of raising extra-budgetary resources and implementation of projects, posted a net profit of Rs 790 crore in FY20.

The Centre plans to sell 15% stake Rail Vikas Nigam (RVNL) worth Rs 600 crore at the current market prices via an offer for sale (OFS), the department of investment and public asset management (DIPAM) said on Monday, while inviting applications from the merchant bankers to manage the issue.

The Centre holds 87.84% of the equity in the company after disinvesting 12.16% through the public issue in April 2019. The company, which was created as an arm of railways with the twin objectives of raising extra-budgetary resources and implementation of projects, posted a net profit of Rs 790 crore in FY20.

The merchant banker will be required to undertake tasks related to all aspects of the OFS, including advising the government on the timing and the modalities of the OFS and regulatory norms, among others. The last date for submission of application by merchant bankers is November 9. RVNL shares closed at `19.15 on Monday, up 2.68% from the previous closing price on the BSE.

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