Mazagon Dock OFS: Government To Sell Up To 4.83% Stake

The Indian government will sell up to 4.83% stake in Mazagon Dock Shipbuilders Ltd. through an offer for sale, according to an exchange filing on Thursday.

The share sale will take place on Friday for non-retail investors and on Monday for retail investors, employees, and non-retail investors carrying forward unallotted bids.

The base offer comprises the sale of up to 1.14 crore shares, representing 2.83% of the company's total equity. Additionally, the government may offload 80.67 lakh more shares, or a 2% stake, through an oversubscription option. If fully exercised, the total stake sale will amount to 4.83%.

"Additionally, 50,000 shares (0.26% of the total offer) may be offered to eligible employees, subject to necessary approvals," the filing noted.

The floor price for the sale has been set at Rs 2,525 per share, which marks a discount of nearly 8% as against the current market price.

The Union government holds an 84.83% stake in the shipbuilding company as of the December quarter, according to data available on the BSE.

• April 4 (T Day): Non-retail investors will be allowed to place bids. They may choose to carry forward unallotted bids to April 7.

• April 7 (T+1 Day): Retail investors, employees, and non-retail investors carrying forward their bids can participate.

Mazagon Dock Shipbuilders, under the Ministry of Defence, is a key shipbuilding company catering to the Indian Navy and commercial maritime sector.

Shares of the company closed 5.13% higher at Rs 2,737.55 apiece on the NSE, compared to a 0.35% decline in the benchmark Nifty. The stock has risen 144.78% in the last 12 months and 22.88% on a year-to-date basis.

Three out of the five analysts tracking Mazagon Dock have a 'buy' rating on the stock, one recommends 'hold' and another suggests 'sell', according to Bloomberg data. The 12-month analysts' price targets implies a potential downside of 18.8%.