Hindustan Copper shares are set to remain in focus in today’s trade as the Government of India will be divesting a 3% stake in the company via an offer for sale (OFS) and a green shoe option of another 3% if it gets a proper response. This takes the total OFS to 6%. The government will be raising almost Rs 3,000 crore via stake paring.
The company will be offering shares at a floor price of Rs 514 per share, which is a discount of 10.5% from the August 25 closing price.
Hindustan Copper OFS details
The President of India, acting through the Ministry of Mines, will offer over 2.90 crore shares of face value Rs 5 each, which makes up 3% of the company’s issued and paid-up equity capital, as per a BSE filing on Monday.
The total issue size is 5.80 crore equity shares worth Rs 2,982.30 crore, 6% of the selling capital. This excludes 25,000 equity shares of Employee Reservation amounting to Rs 1.285 crore, which is 0.002% of the OFS.
Emkay Global Financial Services, DAM Capital Advisors, and IDBI Capital Markets & Securities are brokers to the government, with DAM Capital acting as settlement broker. The NSE is the designated exchange and NSE Clearing the designated clearing corporation.
Bidding will run from 9.15 am to 3.30 pm on both days. Non-retail investors will bid on August 25, and retail investors and eligible employees will bid on August 26, alongside non-retail bidders who choose on day one to carry forward unallotted bids.
Settlement for bids received on both days will take place on August 27 because of a clearing holiday on August 26, the notice said.
Reservations for individual investors, employees, and funds
A minimum of 10% of the offer shares are reserved for retail investors, defined as individuals bidding up to Rs 2 lakh aggregated across both exchanges. For mutual funds and insurance companies, at least 25% is reserved, which is subject to valid bids at or above the floor price. No other single bidder may be allotted more than 25% of the offer.
In addition, 25,000 equity shares have been reserved for eligible employees. They can place bids for a maximum amount of Rs 5 lakh, but the usual limit for allotment is set at Rs 2 lakh, with the possibility of receiving larger allotments only if the employee category is undersubscribed. Employees are required to place their bids based on Tuesday’s determined cut-off price. As stated in the exchange filing, no discounts have been offered to retail investors or employees.