The Union Government on Friday announced that it will sell a 10 per cent stake in Indian Oil Corporation on Monday on the stock market through an offer for sale (OFS).
“This is a very good time to disinvest in IOC, and there is excellent appetite in the market,” Disinvestment Secretary Ms. Aradhana Johri told reporters at a press conference.
The 10 per cent equity in IOC comprises 24.27 crore shares. The price has not been set, so Ms Johri declined to comment on what the proceeds of the stake sale would be. At present, the government holds a 68.57 per cent stake in IOC, India’s biggest oil refining and marketing company.
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Shares of IOC closed 0.70 per cent down at Rs.394.45 a share on the BSE on Friday. At that price, the 24.27 crore shares will fetch the government Rs.9,573 crore.
Ms. Johri also announced the results of its 5 per cent stake sale in Dredging Corporation of India on Friday. It sold 14 lakh shares and received bids worth Rs.142 crore. “The retail response for Dredging Corporation was very encouraging,” Ms Johri said, adding that the retail portion was subscribed 11 times.
The IOC stake sale marks the fourth round of disinvestment this year, the other three being in Power Finance Corporation, Rural Electrification Corporation and Dredging Corporation. So far, the government has raised around Rs.3,300 crore via disinvestment, a paltry sum compared to the target of Rs.69,500 crore set by Finance Minister Arun Jaitley in his Budget speech.
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However, in absolute terms, Ms Johri pointed out that this was one of the most successful years in terms of the amount raised via disinvestment, and is likely to remain that way for some years to come.