CIl helps Govt meet 50% disinvestment target, garners Rs 22,600 cr

In what could be the biggest share sale in the current fiscal, the Government on Friday garnered about `22,600 crore from the 10 per cent stake sale of Coal India limited. The mega share helped the Government to meet its disinvestment target of Rs 43,425 crore for the current fiscal ending on March 31, out of which only `1,700 crore have been collected so far.

 The stake sale was over-subscribed by 1.07 times that received bids worth `24,210 crore largely propelled by domestic financial institutions. However, the retail investor portion remained under-subscribed at 44 per cent where 12.63 crore shares reserved for these investors received bids only for less than half the size (5.56 crore). In value terms, they bid for shares worth `1,929 crore, which is still the largest for any divestment so far, Disinvestment Secretary Aradhana Johri said in a press conference.

FIIs alone bid for `5,919 crore shares in this category, Johri added. This is the biggest share sale by any private or public sector company that exceeded its own previous record of over `15,000 crore made in 2010. The average bid price was, however, higher at `360.11 for the retail category as against floor price of `358. Retail investors would get a price discount of five per cent.

CIl would be the second company to hit the markets under the Government's disinvestment programme in the current fiscal, the first being SAIl in which shares worth about `1,700 crore were sold. Coal India alone can help the Government meet more than half of the total target. This was the first disinvestment in which the shares reserved for retail investors were doubled to 20 per cent. A minimum of 25 per cent of the issue size were reserved for mutual funds and insurance companies. 

Meanwhile, the five trade unions operating in the coal sector held demonstrations during the day across the country, to protest against the Coal India disinvestment. Shares of Coal India closed at `360.85, down 3.81 per cent over previous close on the Bombay Stock Exchange.