The NTPC offering was the government's third divestment in the current fiscal during which it has a target of Rs 30,000 crore
Government-owned power utility major NTPC’s one-day offer for sale (OFS) through which the government sold 9.5% stake in the company was subscribed 1.7 times on Thursday. The government is reported to have mobilised around Rs11,400 crore by offloading nearly 78.32 crore shares at an average price of Rs145.91.
Domestic institutional investors including insurance companies and mutual funds were major bidders.
The NTPC offering was the government's third divestment in the current fiscal during which it has a target of Rs 30,000 crore. Last week the government garnered around Rs 3,100 crore by divesting its stake in crude refiner Oil India and around Rs 5,900 crore through a, OFS for NMDC in December. The government has, so far in FY13, mobilized about Rs 20,000 crore though divestments of its stake in these companies, which is about 67% of its target.
The government is eyeing another Rs5,000-Rs7,000 crore through divestment in some more state-owned companies. The mobilisation will help the government mover closer to its fiscal deficit target of 5.3% of GDP.
Data on BSE website showed that the NTPC OFS had generated a demand for about 132.85 crore shares and all those who bid at Rs145.55 or above have been allotted shares of the government-run power utility major. Market players said that the recent change in rules for OFS that of allowing institutional investors to bid for stocks at no margin helped the NPTC issue sail through.
Earlier, institutions had to put in full margin money while bidding in an OFS. Under the new rules, an institutional investor which is bidding in OFS without any upfront margin cannot revise its bid price downward, while those bidding with full margin money can do so.
Inside story of the National Stock Exchange’s amazing success, leading to hubris, regulatory capture and algo scam
Fiercely independent and pro-consumer information on personal finance.
1-year online access to the magazine articles published during the subscription period.
Access is given for all articles published during the week (starting Monday) your subscription starts. For example, if you subscribe on Wednesday, you will have access to articles uploaded from Monday of that week.
This means access to other articles (outside the subscription period) are not included.
Articles outside the subscription period can be bought separately for a small price per article.
Fiercely independent and pro-consumer information on personal finance.
30-day online access to the magazine articles published during the subscription period.
Access is given for all articles published during the week (starting Monday) your subscription starts. For example, if you subscribe on Wednesday, you will have access to articles uploaded from Monday of that week.
This means access to other articles (outside the subscription period) are not included.
Articles outside the subscription period can be bought separately for a small price per article.
Fiercely independent and pro-consumer information on personal finance.
Complete access to Moneylife archives since inception ( till the date of your subscription )
