IRFC Shares Down On Day One Of OFS For Non-Retail Bidders

Shares of Indian Railway Finance Corp. were down during early trade on Wednesday as bidding by non-retail investors opened under the offer for sale by the government. The Centre will dilute 4% stake in IRFC through the OFS. 

The floor price has been set at Rs 104 per share. The OFS will open for retail investors on Thursday.

"While placing their bids, non-retail investors may indicate their willingness to carry forward their un-allotted bids to T+1 day for allocation to them in the unsubscribed portion of Retail Category. Those non-Retail Investors who have placed their bids on T day and have chosen to carry forward their unallotted bids to T+1 day, shall be allowed to carry forward and also revise their bids on T+1 day as per the OFS Guidelines," according to a stock exchange fling.

Any unsubscribed portion of non-retail category after allotment shall be eligible for allocation in the retail category. The allocation to the non-retail investors shall be at a price equal to the cut-off price or higher as per the bids, the filing added.

The OFS is a move to align the company with minimum public shareholding norms. The government holds 86.36% stake in the NBFC, under the administrative control of the Ministry of Railways. This means that the government has to dilute 11.36% stake in IRFC if it wants to meet the minimum public shareholding norm.

As per MPS norm, a listed entity must have a minimum public float of 25% within five years of listing.

IRFC Share Price Movement

IRFC share price fell as much as 4.2% to Rs 104.82 on the NSE, compared to a 0.7% gain in the benchmark Nifty 50. The total traded volume was twice the 30-day average with a total turnover of Rs 177 crore. The relative strength index was at 39.

ALSO READ: Govt To Trim Up To 4% Stake In IRFC Via OFS — Check Floor Price

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