Ircon International Shares Tumble Over 8% On Government Plan To Sell Stake

Shares of Ircon International Ltd. fell on Thursday, as the government plans to sell 8% stake in the company for Rs 1,158 crore.

The government currently holds an 89.18% stake in the railway engineering company. After the offer for sale, the government's stake in the company will reduce to 67.3%.

It will sell 3.76 crore shares, which is 4%, and will divest an additional 4% through the greenshoe option at a floor price of Rs 154 per share.

The offer for sale will open on Dec. 7 for non-retail investors, while retail investors can participate on Dec. 8. The floor price is set at a discount of 10% on Wednesday's closing price of Rs 171.95 apiece on the NSE.

Shares of Ircon International fell as much as 8.37%, the lowest since Nov. 17, before paring loss to trade 7.4% lower at 10:13 a.m. This compares to a 0.33% decline in the NSE Nifty 50.

The stock has risen 166.28% on a year-to-date basis. Total traded volume so far in the day stood at 5 times its 30-day average. The relative strength index was at 48.45.

Of the three analysts tracking the company, two maintain a 'buy' rating and one suggests a 'sell', according to Bloomberg data. The average 12-month analysts' consensus price target implies an upside of 1.3%.