Tata Communications share price falls 7% as govt plans to divest its entire stake via OFS

Tata Communications share price fell as much as 7 per cent to Rs 1,206.30 apiece on BSE on Tuesday, a day after DIPAM Secretary Tuhin Kanta Pandey informed that the government will sell up to 16.12 per cent stake in TCL through an offer-for-sale. The floor price has been fixed at Rs 1,161 per equity share. Tata Communications stock price hit a fresh 52-week high of Rs 1,365 apiece in the previous week, rising a massive 563 per cent from its 52-week low in less than a year. So far, 58,000 stocks have traded on BSE in intraday deals, while a total of 22.85 lakh scrips have exchanged hands on National Stock Exchange (NSE). The OFS has opened for only non-retail investors today. Retail investors will be able to subscribe on Wednesday.

DIPAM Secretary also informed that the government would divest 10 per cent shares with an additional 6.12 per cent as Green Shoe Option. Around 10.45 AM, Tata Communications shares were trading 5 per cent down at Rs 1,232.55 apiece on BSE, as against a rise of 0.84 per cent in the benchmark S&P BSE Sensex. After a stellar run in 2021, Tata Communications stock price has finally started correcting post the OFS by the government, says AR Ramachandran, Co-founder & Trainer, Tips2Trades. Ramachandran advised long term investors to use this opportunity to book profits as a steeper correction till Rs 1,040 and Rs 985 could be possible due to weaker fundamentals. “A broader-based correction in the overall markets could be foreseen in the coming weeks,” he added.

In Tata Communications, the government will initially offer to sell up to 2.85 crore equity shares representing up to 10 per cent of the total paid-up equity share capital of the company. The government may sell additional 1.74 crore equity shares representing 6.12 per cent of stake in Tata Communications as an oversubscription option. As per the shareholding pattern of the promoter and promoter group in Tata Communications, the promoters hold a 74.99 per cent stake in the company. Of this, the Government of India holds a 26.12 per cent stake while Panatone Finvest has 34.80 per cent and Tata Sons has a 14.07 per cent stake in TCL. The remaining 25.01 per cent is with the public.