Coal India Limited is expected to launch a fresh Offer for Sale (OFS) soon, with up to Rs 5,000 crore worth of shares likely to change hands, according to sources in the merchant banking circle.
The proposed OFS is expected to be structured with a base issue size of Rs 2,500 crore, while an additional Rs 2,500 crore could be raised through a green shoe option, taking the total potential transaction size to Rs 5,000 crore.
As per market indications, the indicative floor price for the OFS is pegged at around Rs 412 per share, which represents roughly a 10% discount to the prevailing market price.
An OFS is a simplified mechanism used by listed companies or promoters, often the government in PSU divestments, to reduce their stake in the market. It allows faster execution compared to traditional follow-on public offerings and is commonly used in disinvestment programmes.
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The government is preparing a phased pipeline of Offer For Sale transactions across three of the four public sector enterprises in the first two quarters of FY27. Coal India, Life Insurance Corporation, Indian Overseas Bank and IRFC have emerged as the likely candidates, sources have told NDTV Profit.
The rollout with be calibrated as per market conditions, with the government keen on easing of volatility before proceeding.
Among the specific transactions under consideration, the government may dilute up to 2% stake in Coal India through an OFS. An LIC OFS is likely in Q2, between July and September. Further stake dilution in Indian Overseas Bank and IRFC is under active consideration, though the timing of the OFS hinges on market stability.
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