IRCTC: The government plans to sell up to 20 per cent stake in Indian Railways Catering and Tourism Corporation (IRCTC), a railway undertaking, through Offer for Sale (OFS). This offer for sale is opening today on Thursday i.e. December 10. Today it will be open for non-retail investors, while the second day will be open for retail investors. Tuhin Kant Pandey, secretary of the Department of Investment and Public Asset Management (DIPAM), has given this information through a tweet. The government will sell 15 percent stake in it with a 5 percent green shoe option.
Rs 1367 Floor Price
A floor price of Rs 1367 has been kept for the sale offer. IRCTC stock closed at Rs 1618 at the end of trading on Wednesday. The government will sell a total of 32 million shares under this sale offering, which is expected to fetch Rs 4,374 crore. Explain that the government has set a target of raising Rs 2.10 lakh crore through disinvestment during the current financial year.
How much is the government’s share
The government currently holds 87.40 percent stake in IRCTC. Under the guidelines of market regulator SEBI, the government has to reduce its stake in the company to 75 percent. IRCTC has exclusive rights to book train tickets, catering trains and sell bottled water.
IPO came in October last year
IRCTC launched its IPO in October last year. This IPO was taken over by investors and it received tremendous response. For the employees, these shares were offered at a discount of Rs 10 for Rs 310, while the remaining investors had these shares worth Rs 320. The government had raised around Rs 645 crore through an IPO and sold a 12.6 per cent stake.
What happens OFS
OFS is the only way to sell shares. This gives promoters of already listed companies a way to easily issue shares. This issue is issued only among the existing shareholders. Apart from retail investors, it can be issued to all types of investors including mutual fund investors, foreign institutional investors, insurance companies, corporate, NRIs. Any company that wants to issue OFS has to inform it two days before the issue.
Source: www.financialexpress.com