State-owned hydropower producer NHPC ltd’s share sale today garnered 1.58 times subscription, totalling Rs3,410 crore, with most bids coming in from lIC and mutual funds.
Day one of the two-day share sale, wherein the Government is offloading 11.36 per cent of equity, saw subscription for 156.79 crore shares as against 100.61 crore offered to institutional investors, according to the stock exchange data.
Most of the bids came at the floor or minimum bid price of Rs21.75. At this price, subscription of over 156.79 crore shares totaled Rs3,410 crore. Investment banking sources said most of the bids came from mutual funds and insurance companies including life Insurance Corporation (lIC). The offer for sale (OFS) will open today for retail subscribers.
NHPC is the first disinvestment by the government of the current fiscal, where it is targeting Rs56,500 crore through selling shares and privatisation of public sector undertakings (PSUs). Government is selling over 125.76 crore equity shares of NHPC that will bring down its shareholding in the company from 85.96 per cent to 74.6 per cent. This will help NHPC comply with the minimum 25 per cent free-float requirement.
The remaining, over 25.15 crore shares, will be sold to retail investors tomorrow. They will be allocated shares at 5 per cent discount to the cut-off price. These individual investors are to place bids for shares of total value not exceeding Rs2 lakh.