Shares of General Insurance Corp. of India fell to their lowest level in over two weeks on Wednesday as the government began the process of selling a 6.78% stake in the company at Rs 395 each. The offer opened for non-retail investors on Wednesday.
In the offer to sell, the Government of India will offload a total of 11.90 crore shares with a face value of Rs 5 each. On Wednesday, it will make a base offer of 3.39% equity to non-retail investors. For retail investors and employees, the offer will open on Thursday with an additional 3.39% equity option to subscribe, the company said in an exchange filing.
Additional 50,000 equity shares will be offered for the company's employees, the exchange filing said.
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As of June 30, the Government of India owns 150.5 crore shares, or 85.78% of its total equity. The rest, 14.22%, is public owned. General Insurance Corp of India has 175.44 crore shares.
General Insurance Corp of India fell 4.91% to Rs 400.91, the lowest level since Aug 19. It was trading 4.51% lower at Rs 402.65 apiece, compared with 0.67% decline in the benchmark Nifty 50.
The scrip gained 78.50% in 12 months, and 30.76% on year to date basis. Total traded volume so far in the day stood at 15 times its 30-day average. The relative strength index was at 49.58.
Out of four analysts tracking the company, one maintain a 'buy' rating, X recommend a 'hold,' and three suggest 'sell', according to Bloomberg data. The average 12-month consensus price target implies a downside of 15.7%.
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