By Rajesh Abraham, The government on Thursday reached closer to its divestment target for this financial year after its Rs 11,400 crore share sale in NTPC was oversubscribed nearly 1.7 times. There were bids for 1,328.46 million shares compared with 783.26 million on offer, which accounted for 9.5 per cent of the company’s shareholding. At the indicative price of Rs 145.91 apiece, the government will collect Rs 11,428.59 crore. Earlier, the government had fixed the floor price for the stake sale in the state-owned enterprise at Rs 145 a share. On Thursday, the NTPC share closed at Rs 148.15, down Rs 4.15 apiece or 2.72 per cent, still over Rs 2 higher than the offer price. With the success of the NTPC issue, the government is closer to its target of raising Rs 30,000 crore from the disinvestment in this financial year. While bids for 635 million shares were made at 100 per cent margin, bids for another 693.41 million shares were at zero per cent margin, as per the information available on the NSE website. Last week, the government raised Rs 3,113 crore through an offer for sale of shares of Oil India (OIL). The changes brought about by the capital markets regulator Sebi in OFS, such as allowing institutional investors to bid for shares without upfront margin money and providing the indicative price throughout the trading session to bring transparency, seem to be working, experts said. Sebi rules require government-owned companies to meet the minimum public float requirement of 25 per cent by August this year. For private firms, the deadline is June. Following the share sale, NTPC will comply with the minimum public float requirement. From 84.5 per cent, the government’s stake will come down to 75 per cent after the OFS. This was the fifth disinvestment by the government through the OFS route and fourth in this financial year. The other OFS divestments were OIL (February 1), NMDC (December 12, 2012), Hindustan Copper (November 23, 2012) and ONGC (March 1, 2012). Morgan Stanley India, Citigroup Global Markets India, Goldman Sachs (India) Securities, Deutsche Equities India, Kotak Securities and SBICAP Securities handled the NTPC share sale. With this share sale, the government has raised about Rs 18,330 crore so far in this financial year, including about Rs 2,241.75 crore from the NMDC issue and Rs 799 crore from the Hindustan Copper issue. There are other stake sales lined up in PSUs such as RCF, MMTC, BHEL and SAIL.Source: Mydigitalfc.com, Image: photobucket.com
